UK households urged to claim £2,000 'top-up' from HMRC with 'too many missing out'

Parents are being urged to claim a £2,000 'top-up' from HMRC that they may have missed out on. HMRC said 571,945 families received payments through the Government's Tax-Free Childcare scheme in June, getting an average of £100 a month towards nursery, childminder or after-school club costs.

But experts warned "too many still miss out" on the support, which can make the difference between returning to work and staying at home. Under the system, for every £8 paid in, the Labour Party government adds £2, up to a maximum of £2,000 a year per child under 11 - or £4,000 for disabled children up to 16. Financial adviser Philly Ponniah, of Philly Financial, said: "Childcare costs are one of the biggest financial pressures facing working parents, and too many still miss out on help they're entitled to. Schemes like Tax-Free Childcare can make a real difference, but the system is confusing. Many don't realise it's separate from the 15 or 30 funded hours, but can be claimed as well - even for after-school clubs and holiday camps."

Single mother Kate Allen, who runs Kingsbridge-based Finest Stays, said: "As a solo parent who's benefited from the Tax-Free Childcare scheme, I can say the impact is huge. For every £8 you pay in, the Government adds £2 - that's a 20% boost straight towards nursery or childcare costs.

"Childcare costs can be crippling, yet too few families know about this support. It's completely separate from the 30 free hours scheme, and both can be used together to make a real difference."

David Stirling, an adviser at Belfast-based Mint Wealth, said: "HMRC says claim your treats and don't get tricked out of your childcare savings. With childcare being one of the biggest costs for working families, it's important to take advantage of schemes like this.

"Hopefully this will relieve some pressure on beleaguered Brit household finances and make working more viable for parents - especially mothers, who are more likely to reduce hours or sacrifice careers because of childcare costs."

Samuel Mather-Holgate, of Mather and Murray Financial, praised the scheme, calling it "probably the best policy since Starmer moved in".

"It could be revolutionary for getting families back to work and boosting productivity. The awareness is still not out there, though - more needs to be done to show new parents their options."

Kundan Bhaduri, of The Kushman Group, said: "These subsidies are life support for a system where going to work can cost more than staying home. I've seen countless talented women abandon promising careers because nursery fees now exceed mortgage payments.

"Handing out £100 monthly top-ups doesn't fix a system where childcare costs more than most people earn after tax. It's creating an economy that imports workers instead of raising them."