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Updated on 6 April 2023

Universal credit: childcare support

Universal credit is a means-tested benefit for people who need help with living costs who are in or  out of work. Universal credit is made up of several different elements including a childcare element. If you meet the qualifying rules, then you may be able to claim up to 85% of your childcare costs up to certain maximum levels.

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Universal credit is paid by the Department for Work and Pensions (DWP) and will eventually fully replace the following benefits:

  • Child tax credit
  • Working tax credit
  • Income support
  • Income-related employment and support allowance
  • Income-based jobseeker’s allowance
  • Housing benefit

Universal credit is a monthly benefit and the amount you receive is based on your circumstances and income in the previous monthly ‘assessment period’. If you currently claim tax credits, until you move over to universal credit, you may be able to get the childcare element of working tax credit if you start paying childcare costs.

Universal credit is made up of different elements. You qualify for the different elements based on your household circumstances. All of the elements you qualify for are added together to find a maximum amount which is then reduced based on your income.

Universal credit includes a childcare element. If you meet the qualifying conditions and you have eligible childcare costs, you can include your childcare costs in your claim. This element is worth up to 85% of your childcare costs. The current maximum you can claim increased from June 2023 to 85% of £950.92 per month for one child (£808.29) or £1,630.15 (£1,385.63) per month for two or more children.

Universal credit claimants with childcare costs can access the funds upfront in certain situations but usually you report the childcare costs you have paid in the previous assessment period. You should report your costs through your universal credit online journal by the end of the assessment period for the support to be included in your next universal credit payment but, if there’s a delay, you still have up to the end of the following assessment period to report your childcare costs and the relating childcare element will be paid with that following universal credit award.

Universal credit is usually paid monthly into your bank account but you can ask for more frequent or alternative payments arrangements.

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