Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps her Department is taking to simplify the tax-free childcare eligibility process for self-employed parents in line with the system in place for employed claimants.

The Government is committed to ensuring eligible parents, whether they are employed or self-employed, can access Tax-Free Childcare as efficiently as possible.

To be eligible for Tax-Free Childcare, a parent and their partner (if they have one) must expect to earn at least the National Minimum or National Living wage for 16 hours a week on average and earn no more than £100,000 per year. The process to access Tax-Free Childcare for self-employed and employed parents is the same. Both are required to apply and reconfirm each quarter that they meet the same eligibility criteria.

In instances where stated expectations differ from the information HMRC holds through PAYE or Self-Assessment Records, at times HMRC may need information from customers to confirm their eligibility.

The Government recognises that evidencing income can be more complex for self-employed individuals, particularly for those with variable or seasonal earnings. That is why self-employed parents are only expected to meet the minimum income requirement over the entire tax-year (and not quarterly as is the case for employees). In addition, parents who have started new self-employment are also exempted from meeting the minimum income requirement in their first 12 months in Tax-Free Childcare.