The income rule applies to each partner
The GOV.UK eligibility page says a claim cannot be made when the applicant or their partner expects adjusted net income, including relevant foreign income, to be over £100,000 for the current tax year. This is an individual ceiling. Two partners each expecting £90,000 are not disqualified merely because their combined income is £180,000; one partner expecting £100,001 can fail the income condition.
The boundary wording matters. Exactly £100,000 is not over £100,000, so the calculator displays ‘at threshold — check official eligibility service’ rather than marking the family as over. That is not a guarantee of entitlement. Expected income can change, and work, earnings, child, immigration and interaction-with-other-support rules must still be satisfied and reconfirmed through the official childcare account.
The test uses adjusted net income, not headline salary
Adjusted net income begins with total taxable income before Personal Allowance. Employment income, taxable company benefits, self-employed profit, interest, dividends, pensions, rental profit and relevant foreign income can contribute. The figure is then reduced by specific items, including grossed-up Gift Aid and qualifying pension contributions. A salary shown on an employment contract is therefore not always the final number used for the childcare income test.
Pension treatment depends on method. A relief-at-source personal payment is grossed up by dividing the amount personally paid by 0.8. A gross contribution without tax relief is deducted at its gross value. Salary sacrifice or net-pay contributions may already have reduced P60 taxable pay and must not be deducted again. The calculator asks which income figure was entered so the same payroll reduction is counted only once.
How the government top-up works
For every £8 paid into a Tax-Free Childcare account, the government adds £2. GOV.UK’s example describes this as the parent paying 80% of an eligible childcare bill and the government providing 20%. A £250 bill can therefore be funded by a £200 parent payment and a £50 top-up, assuming the account, provider, child and payment all satisfy the scheme’s requirements.
The standard top-up limit is £500 every three months, up to £2,000 per child each year. For an eligible disabled child, those limits rise to £1,000 every three months and £4,000 a year. The website’s spending estimate treats the entered amount as the total eligible provider bill and takes 20%, subject to annual per-child caps. It cannot allocate uneven spending perfectly between children or quarters.
The other work and earnings conditions
The scheme normally requires the applicant and their partner, if they have one, to be working or returning to work. Minimum earnings requirements are linked to 16 hours a week at the applicable National Minimum Wage or National Living Wage and vary by age. GOV.UK also explains exceptions for certain leave, incapacity and caring situations, plus special treatment for a newly self-employed person.
Some income that matters for adjusted net income does not count towards the minimum-earnings test. The official page identifies dividends, interest, property investment income and pension income among the amounts excluded from that minimum. This is why a calculator cannot infer full eligibility simply from adjusted net income. One income concept controls the £100,000 ceiling while a different earnings test establishes sufficient work.
Child age and approved childcare
A child is normally eligible until the September after turning 11. An eligible disabled child can remain within the scheme until the September after turning 16 and must meet the official disability conditions. The child must usually live with the applicant. Foster children are treated differently, and the GOV.UK page lists additional restrictions and interactions that this income-focused calculator does not decide.
Payments must go to approved childcare through a provider registered for Tax-Free Childcare. That can include registered nurseries, childminders, nannies, after-school clubs, play schemes and holiday clubs where the relevant registration conditions are met. The applicant should check the provider’s status before relying on a top-up estimate. The website does not search the provider register or transfer money to a childcare account.
Interactions and three-month reconfirmation
Tax-Free Childcare cannot be received at the same time as Universal Credit childcare or childcare vouchers. Moving between schemes can have financial consequences, so the official comparison and eligibility services should be used before ending existing support. The calculator does not compare the value of Universal Credit, legacy vouchers or employer-specific arrangements and should not be used to make that switch by itself.
A childcare account must normally be reconfirmed every three months. Expected adjusted net income is a current-tax-year forecast, which means bonuses, benefits, investment income or business results can change the position after an initial estimate. Keeping pay, pension and other income records up to date is important. Where expected income is close to £100,000, the official service or HMRC is the appropriate place to confirm treatment.
Check the numbers with the full calculator
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