Child Care Tax Relief was introduced in 1998 for children aged 0 - 5 and extended to children aged 12 from 2000.
The following explains the circumstances in which tax relief is granted to Family Day Care Providers.
For further information about the registration process for Family Day Care providers, go to Day Care Registration at the Education Sport & Culture Department.
It is recognised that one of the greatest barriers to employment is the cost of paying for a child to attend:
holiday play care scheme
This tax relief helps those already in work and may encourage others to go back to work. That will help relieve pressure in the job market and so ease the immigration problem.
There is also evidence that good quality child care can provide children with a headstart in life.
In order to promote good quality child care, tax relief is only given for payments made to registered Family Day Care providers.
But I don't pay tax.......
You should contact Social Security on (01534) 445505 to see whether you qualify for the Child Care Allowance for a child aged 5 or under. The Jersey Child Care Trust (01534) 629901 may be able to help in the case of older children.
Who qualifies for tax relief?
The purpose of this tax relief is to help those who have to pay for their children to be looked after while they go out to work.
It therefore applies to working mothers as well as to employed single fathers who live alone (i.e. without a partner). A married man can claim if he has to pay for child care because of his wife's severe illness or disability.
Broadly speaking, the tax relief is limited to people in the middle income bracket. For those with higher incomes the relief tapers away and eventually disappears.
I work as a freelance artist from home. Do I qualify?
The fact that you are self employed, rather than employed , does not stop you claiming this tax relief.
I only work part time. Can I claim?
Yes you can. However, the first £4,500 of your income is disregarded for the purpose of this tax relief. That part of your income is already tax - free.
My seven year old is looked after until I get back from work. Can I claim the cost?
Yes, provided that the day care provider is registered with the Education, Sport & Culture Department.
I pay my mother-in-law to look after my 4 year old. Can I claim what I pay her?
You can only claim for payments made to a person or establishment registered under the Day Care of Children (Jersey) Law 2006. Information about the registration process is obtainable from the Education, Sport & Culture Department.
How do I know whether my day care provider is registered?
If registered, your Family Day Care provider will have been awarded a certificate to that effect by the Education, Sport & Culture department.
Can I claim the whole cost?
As mentioned earlier you can only claim against that part of your income that exceeds £4,500. Subject to that, you can claim the actual costs or £6,150 whichever is lower.
How do I claim?
The tax return includes a section for claiming this tax relief.
As evidence of the payments made for a qualifying child you will need to obtain a certificate from the person or establishment concerned. Blank certificates are issued to all registered child care providers.
When you send in your completed tax return, enclose the certificate.
My husband and I have separated and are both contributing to the cost of looking after our 4 year old. How is that dealt with?
The certificate mentioned in the last section shows the child's name, rather than the payer's.
In the circumstances you describe, both of you will be able to claim. You should reach agreement on how to split the child care costs and claim accordingly on your tax returns.
In the event of a dispute, the Comptroller of Income Tax will make a judgement, based on the evidence supplied by the parties. If his decision is not accepted, there is recourse to the Commissioners of Appeal (an independent tribunal).
I am a single man and live with my girlfriend. Can I claim the cost of minding our new baby?
No, but your girlfriend can claim against her income if the child care costs are incurred so that she can go to work.
I am a divorced man who has custody of our daughter. I have to pay a day carer because I live alone. Can I claim?
Yes.
Because my wife is not at all well I pay for our 3 year old to attend a nursery to relieve the burden on my wife while I am at work. Can I claim?
Yes , provided that your wife's incapacity is such that you qualify for the Additional Personal Allowance.
If I help my daughter with the cost of sending her toddler to a nursery can I claim?
No. Only the person entitled to the income tax Child Allowance can claim Child Care Tax Relief. Your daughter will be able to make a claim even if the money to pay the nursery is a gift from you.
I live with a man whose wife has returned to the U.K. and left him with their 3 year old boy. I take care of the child whilst he goes to work. If we pay a Family Day Care provider so that I can also go to work can I claim against my earnings?
Yes. In this situation you are deemed to have some entitlement to Child Allowance as you have a degree of care and control of the child.
At what level of income does the Child Care Tax Relief no longer apply?
This depends on the individual circumstances. The intention is to direct assistance to taxpayers in what might broadly be termed the middle-income bracket.
If in doubt, the best course is to make the claim on your tax return. Your assessor will ensure you get the relief if it is due.
HOW TO GET MORE INFORMATION
THESE NOTES DO NOT COVER EVERY POINT.
Further information about whether your payments qualify for tax relief can be obtained by setting out the details in writing to:
Comptroller of Income Tax,
P.O. Box 56,
St. Helier,
Jersey,
JE4 8PF
or by telephoning the Income Tax Help Desk on (01534) 440300.
