Nanny is becoming a tax break

The Guardian

London, May 16:

They gave their names to the ‘nanny culture’, helped to raise hundreds of thousands of youngsters and were celebrated by Julie Andrews in Mary Poppins. Now nannies are to become the subject of tax breaks. British government ministers will reveal today that parents who hire people to look after their children will be eligible for tax relief. In this way, mothers will be encouraged to go back to work. At present, many families are being priced out of childcare by crippling costs. A full-time nanny in London can earn up to 27,000 sterling pounds a year, more than a woman’s average salary. The perk is not restricted to full-time nannies. It will also be extended to those who use after-school and holiday clubs or who employ trained childminders in the child’s own home. But relatives who look after children in their own home, will be excluded. Ministers say it would be ‘inappropriate’ to bring money into family arrangements. This will disappoint parents who are reluctant to leave their children with strangers.

Anne Longfield, director of the group 4Children, said the nanny tax relief would benefit thousands of families. “It’s a kind of childcare which we know masses of people have been using, but they don’t get any help for it,” she said. The tax break, which is likely to be introduced by next April, is expected to be of most use to families with part-time nannies or nanny shares - where the same carer is swapped between several parents - than to households who pay for full-time nannies because it is available only to families earning up to 58,000 sterling pounds a year. Those who can afford to hire a full-time, live-in nanny, particularly in London and south-east England, are more likely to have higher salaries.