Welcome to our guide to free childcare available specifically via Universal Credit. This builds upon our previous childcare funding guides, giving parents yet another potential way to get financial help towards childcare costs. Which scheme suits you best rather depends upon your individual situation as each has its own rules for eligibility. If one scheme doesn’t fit with your situation, another may. You may even find that you can apply for multiple schemes in certain circumstances, and we’ll also touch upon that in this guide. (To view our previous guides on other funding schemes, see our Rough Guide to Free childcare Funding in England and our Complete Guide to the Tax-Free Childcare Scheme).
Anyway, let’s get back to childcare funding specifically from Universal Credit …
Firstly, what is Universal Credit?
Universal Credit is a Government funding system that was introduced in 2013 to simplify the welfare payment system. In essence, it helps people with their living costs, for example if they’re on low incomes or are not working. It also potentially includes funding for childcare, to help parents with the costs of looking after dependent children (more about that later). The scheme’s aim is to eventually replace 6 existing benefits** into a single, unified payment scheme. Payments are made monthly in England (sometimes twice a month in Scotland).
How much can you get towards childcare with Universal Credit?
If you are eligible, you may be able to reclaim up to 85% of childcare costs through Universal Credit. The most you can reclaim each month is usually £950.92 for one child or £1,630.15 for two or more children (figures have been updated for 2023) unless there are exceptional circumstances. You may also be able to claim for additional children under the scheme, but only if they were born before 6th April 2017. If eligible, you can claim for dependent children up to the 31st of August following their 16th birthday.
Your payments for childcare costs under the scheme are usually paid in arrears. This means you will need to pay the costs yourself and then claim the money back through your Universal Credit claim. (2023 UPDATE: Following childcare funding reforms announced in the Chancellor’s Spring Budget in 2023, however, there are exceptions — good news for those struggling the most).
The amount you are paid in your job, if you have one, can affect how much your Universal Credit payments will be. If your earnings are more than usual in an “assessment” period, this can reduce your Universal Credit payment, including the amount of any help towards childcare costs.
Eligibility criteria
To be potentially eligible for childcare help through Universal credit, you must live in the UK, be on a low income or out of work and be aged 18 or over (although there are some exceptions for 16 and 17 year olds). You and your partner, if you have one, must also be under State Pension age and have no more than £16,000 in savings/investments between you.
You, and you and your partner, if you live with them, usually* need to be employed or have an offer of employment, and be paying for childcare for a child or young person. Paid work does not include being engaged by a charity or a voluntary organisation or being a volunteer where the only pay is expenses. Also, if you stop work, you must inform Universal Credit of the change in your circumstances.
* Childcare costs may still be paid if one partner is employed and the other cannot look after the child/children because they have limited capabilities for work and work-related activities, care for a disabled adult or child, or are temporally absent from the household (e.g. in hospital, residential care or in custody).
You will not be eligible for Universal Credit if you already receive, or are eligible for, Severe Disability Premium.
Claiming back your childcare costs
You will need to tell the Department for Work & Pensions (DWP) about costs of your childcare before the end of the “assessment period” following the one you have paid the fees for. This can be confirmed online via your Universal credit Account. In effect, you are then refunded for any eligible childcare payments via your Universal Credit payment. You can claim up to 3 assessment periods of childcare at a time. To get your childcare costs refunded and to avoid missing out, you should report the childcare costs as soon as possible after you have paid them.
What if you’re off sick or on maternity/paternity leave?
You can still get Universal Credit childcare costs for existing childcare if either you or your partner are receiving Statutory Sick Pay, Statutory Maternity Pay, Statutory Adoption Pay, Statutory Paternity Pay, Statutory Shared parental Pay or Maternity Allowance.
What if you’re changing jobs, or coming to the end of one?
If you have been offered new employment, you can ask for childcare costs for the month preceding the start of your new job. If you are coming to the end of your employment, you must inform the Department for Work and Pensions (‘DWP’) immediately. Help with childcare costs can be claimed at least a month after your employment ends to help you maintain childcare as you switch jobs.
What if you’re still receiving the ‘old’ Tax Credits?
** A few people remain in the ‘old’ schemes that were in place before Universal Credit came into being. These are Child Tax Credit, Housing Benefit, Income Support, Income-based Job Seekers Allowance (JSA), Income-related Employment & Support Allowance (ESA) and Working Tax Credit. If you’re still receiving benefits through one of those, it seems that there is no need to apply for Universal Credits unless you have a change of circumstances that needs to be reported, or you are requested to do so by the DWP.
TIP: It’s important to know that any existing Tax Credits will end once you or your partner apply for Universal Credit — even if you are not successful in your application. So, the message is: if you are receiving Tax Credits check your eligibility and do your research carefully before applying for Universal Credit.
What if you receive childcare vouchers?
If your childcare costs are met by a third party, for example via childcare vouchers supplied through an employer, you can only claim back the balance which you or your partner actually paid yourselves. However, earnings that have been converted into childcare vouchers do not need to be included when working out reductions to your Universal Credit pay.
What if you’re already receiving 15 or 30 hours free childcare funding?
You may still be entitled to apply for the 15 or 30 hours free childcare funding. Universal credit may be able to help towards any additional childcare costs over and above the 15 or 30 hours each week.
Can you only use one childcare provider?
You can have more than one childcare provider. However, to apply for Government help with childcare you must use a registered/approved childcare provider. This generally means that the childcare provider is registered with Ofsted for England, The Care Inspectorate for Scotland or the Care and Social Services Inspectorate Wales (‘CSSIW’) for Welsh settings.
You will need to tell Universal Credit details of the childcare providers you are using. These may include providers supplying childcare via a school, play scheme, nursery, club, a childminder or childcare agency, so long as they’re registered as above. Your provider will need to confirm their registration number, which you’ll need to provide in your application.
How to apply
Checklist
First, you’ll need to get the following ready: • Details confirming what you pay for childcare costs; • An email address; • Your mobile phone handy if you have one; • Your bank or building society account details, or credit union account information; • A credit or debit card; • Details about your housing situation, for example how much rent you pay; • Income details including payslips; • Savings and investment information and any income from property that you rent out; • A driver’s licence or passport.
Then you can apply for Universal Credit payments here. Telephone the Universal Credit Helpline on 0800 328 5644 if you run into any difficulty.
Childcare in Streatham, London SW16
This guide was brought to you by Little Cedars Day Nursery in Streatham, London SW16. We offer childcare services at our nursery and pre-school located in the London Borough of Wandsworth. We’re convenient for parents requiring weekday childcare for babies and under-fives near Streatham, Streatham Park, Tooting Bec, Tooting Common, Furzedown and Balham. Telephone 020 8677 9675 for more details or simply email us here and we’ll be delighted to tell you more about the nursery or to answer any questions. Alternatively, book a tour or the nursery here.
The Tax-Free Childcare Scheme could save you thousands
The Tax-Free Childcare Scheme is available to parents of children up to the age of 11 inclusive, or 16 inclusive if they’re disabled.
Along with helping to fund nursery places at places like 
TIP: If you want the Government’s contribution to go into your account faster, your payment needs to be paid by Bank Transfer (rather than, say, via a debit card or standing order, although those still work fine if you don’t mind waiting a while longer for the Government’s corresponding contribution).
It may surprise some to learn that you can buy some vegetables and herbs just once and never have to buy them again. The secret is knowing which, and how to re-grow them. It turns out that it’s pretty easy, so we encourage parents to help youngsters get started. Once they see growing shoots or roots and, later, vegetables or herbs that the family can actually eat, they’ll be so pleased that they made this little miracle possible. What’s more, it will have taught them something about where food comes from, how to grow it sustainably and how to look after the living plants. If you’re really lucky, it may even encourage them to take things a step further and get involved in food preparation and cooking later on. It’s amazing, actually, where such a simple, fun, activity can lead!
It’s possible, and indeed fairly easy, to grow your own produce even without a garden. So long as you look after your plants and give them water, soil and light as a bare minimum, they will grow. If you don’t have a garden, perhaps you have a small courtyard or patio where you can grow in containers. If you don’t have any outside areas at all, you can grow in flower pots and other containers on window sills, balconies, under skylights and so on. This makes growing produce possible almost anywhere, including in urban London in high-rise flats. After all, it’s in a plant’s nature to want to grow.
Children could start with green onions or spring onions. These are particularly easy to ‘re-grow’. Later, perhaps, the children can apply the same approach to celery, lemon grass, Cos lettuce and Pak Choy (a type of Chinese cabbage). Simply save an inch or so thick section of your shop-bought root vegetables (perhaps the last you will ever need to buy), which includes the bottom part at the root end. All your children need to do is to place that section, root end downwards, in a glass of water. Leave them in the water and, after somewhere between 1 and 3 weeks, roots will start growing. Children will love monitoring this process each day and they will enjoy looking after and caring for a living thing. Once the roots are substantial enough, children can take them out of the glass and re-pot them in soil, ideally with a bit of compost if you have any. This can be in containers, appropriately sized flower pots or in the garden if you have access to one. Before long, your plants will give your children more, free herbs and vegetables that you can all enjoy.
Garlic cloves are also incredibly easy to regrow in a similar way. Perhaps at some point you’ve unintentionally allowed your shop-bought garlic cloves to ‘sprout’. Well, that’s how to start off. Rather than discarding them, your children can put them in water and allow roots to grow. Then, they should plant them out in soil and eventually they’ll end up with more, free, garlic cloves. What’s more, they will tend to taste more mild and delicate than shop-bought garlic — children will probably appreciate that. It’s the same with ginger roots, but allow months rather than weeks in their case.
Herbs like Coriander, Rosemary and Basil can also be re-grown. Children can simply take scraps or clippings (4 inches long in the case of basil, 2-3 inches in the case of Rosemary) and place them in glasses of water in a well-lit spot on the windowsill. Once they have sprouted roots of about 2 or so inches long, these young ‘plants’ can be transplanted into soil or compost in pots. Your child will then be able to watch the plants flourish and grow into new herbs that can be harvested for food later on. The children will also soon discover that each of these herbs has a wonderful and distinctive taste and smell.
Later, when growing sprouts reach the surface, the child should keep those covered with soil (this is called ‘hilling’). Get your child to keep the soil moist but not over-saturated over the subsequent weeks. If planted in the spring, your children should be able to harvest potatoes in the summer.
Then, of course, your children can also experiment with nursery bought, or mail order seeds. Although not free, they’re reasonably inexpensive and also fun for children to grow if you follow the instructions and timing suggested on the seed packets. Beans of various kinds and sugar snaps are particularly easy to grow and usually result in an excellent crop. They will benefit from being in a garden or outdoor patio area, ideally, due to the space they require. They will need more vertical space than horizontal space, however, so even balcony planting may be possible if you have suitable grow bags.
