Apologies if this has been asked a million times before, but I'm going around in circles trying to get my head around this.
We are currently collecting £19.21 per week in child tax credits and my wife is taking £161 salary sacrifice per month for childcare vouchers. Our childcare costs are £69 per week and therefore she is withdrawing £115 or £184 cash to pay the nursery depending on whether it is a 4 or 5 week month. We've been doing this since January.
My wife works 24 hours per week and has an annual income of £9999 and therefore I assume she'll be paying very little tax and NI. I've read in various FAQ that if you are claiming child tax credits, it would not be financially beneficial to take childcare vouchers as well?
Why is this?
I was planning on ringing the tax office next week during my week off work (woohoo) to query this, but it's bugging me that much I've come seeking some answers.
Thank you for reading.
We are currently collecting £19.21 per week in child tax credits and my wife is taking £161 salary sacrifice per month for childcare vouchers. Our childcare costs are £69 per week and therefore she is withdrawing £115 or £184 cash to pay the nursery depending on whether it is a 4 or 5 week month. We've been doing this since January.
My wife works 24 hours per week and has an annual income of £9999 and therefore I assume she'll be paying very little tax and NI. I've read in various FAQ that if you are claiming child tax credits, it would not be financially beneficial to take childcare vouchers as well?
Why is this?
I was planning on ringing the tax office next week during my week off work (woohoo) to query this, but it's bugging me that much I've come seeking some answers.
Thank you for reading.