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Childcare Vouchers

As part of BSU’s employee benefits package, you can now enjoy savings on the cost of childcare by taking part in our childcare voucher scheme.

The scheme works through a salary sacrifice arrangement, which means that you give up part of your salary in exchange for receiving an equal amount in childcare vouchers.

You are allowed to receive childcare vouchers up to £55 per week, or £243 per month. Unlike your salary, you don’t pay any tax or national insurance on childcare vouchers. The saving in tax and national insurance is worth up to £903 a year for basic rate tax-payers, or £1,196 for higher-rate tax payers, which is effectively a net pay rise for parents. If your spouse or partner (this includes same sex partner) is also employed by BSU, then you may both join the scheme, saving families up to £2,392 a year in childcare costs.

Childcare vouchers can be used for a wide range of childcare, including nurseries, playgroups, pre-school, after-school care, play schemes, holiday clubs, nannies and au-pairs. However, the childcare provider must be registered or approved by an appropriate authority, such as Ofsted.

The first date on which childcare vouchers will be available is 21st March 2011. If you wish to benefit from vouchers from the 21st March 2011, then you must register with KiddiVouchers Ltd (the childcare voucher provider) by the last day of February 2011.

You can register online at www.kiddivouchers.com by selecting the 'Join my employers scheme' option, or alternatively by phoning 0845 094 1412, and providing the following details:

  1. The scheme reference number is available from Human Resources/Payroll
  2. Your BSU User ID
  3. Details of your children and contact details of your childcare provider
  4. The amount of childcare vouchers you wish to receive each month

Although you can join the scheme at any time, due to Inland Revenue rules you can normally only leave the scheme or change your voucher amount at the end of 12 months or as a result of change in circumstances as detailed in the policy.

Please note:

The provider we have selected, KiddiVouchers Ltd, has recently been renamed Wider Plan Ltd, to reflect their expansion into a wider range of products and services. The change of name will have no effect on the operation of the childcare voucher scheme, which will continue under the brand name of KiddiVouchers. March 2011.

Information for Employees

Childcare Voucher Policy

  1. Introduction
  2. Scope of Policy
  3. Responsibilities
  4. Rules of the scheme

Introduction & Aims

Bath Spa University is committed both to issues of equality of opportunity and to providing practices that are family friendly.

Childcare vouchers offer staff the opportunity to purchase vouchers using the salary sacrifice method which they can use to pay for any child care. As the cost of the vouchers is deducted by the employer prior to any other statutory deductions this method gives the advantage of reducing the employee’s Tax and National Insurance contributions.

This policy aims to balance the needs of the individual with the operational needs of the organisation.

Scope of Policy

The Policy applies to all employees, across all grades and groups including academic and professional services staff, fixed term and part time hourly paid lecturers, part time and full time, permanent and temporary staff.

Childcare vouchers have been introduced on a trial basis and this policy and their continued availability will be reviewed in January 2013.

Responsibilities

Employee
Finance
Human Resources
Childcare Voucher Provider

Rules of the scheme

Eligibility

To be eligible for the childcare voucher scheme you must:

Childcare vouchers can be spent up to 1st September after the child’s 15th birthday (or if the child is disabled 1st September after their 16th birthday).

  1. When salary is swapped for childcare vouchers the remaining salary must not fall below the National Minimum Wage (NMW). If this happens, BSU restrict the amount of childcare voucher to meet the NMW requirements.
  2. BSU will also override the voucher during periods of maternity, paternity, adoption and sick leave if the earnings are not sufficient to cover the requested voucher. Please note deductions cannot be made from statutory payments such as SMP, SPP, SAP or SSP.
  3. Entitlement to some state benefits may be affected if salary drops below the Lower Earning Limit (LEL). For example earnings-related benefits, such as statutory maternity pay, will be based on your reduced salary (i.e. your original salary less the value of your childcare vouchers). This means the amount of benefit you receive could be reduced. In order to prevent pay dropping below LEL, BSU will restrict the amount of childcare vouchers.
  4. Overtime payments will not be taken into account when calculating gross salary for the purposes of making deduction.
  5. All non-statutory employee benefits will be based on full notional salary. For example members of the Local Government Pension Scheme and the Teachers' Pension Scheme should note that pension deductions, such as attachment of earnings, charitable donations etc have been made.
  6. Salary deductions will be prioritised and the deduction for childcare vouchers will not be made until all other salary deductions, such as attachment of earnings, charitable donations etc have been made.
Commitment

Commit to receiving your chosen childcare amount for a period of 12 months from registration, except in the circumstances set out below. You will only be allowed to change or cancel the voucher amount at the end of this period, by giving 23 days notice before the relevant payday.

Changes

Changes can be made in the following circumstances:

Please note that during periods of maternity leave it is possible to take a break from the childcare voucher scheme without actually leaving the scheme.

Benefits

Employees may receive up to £243 per month (£55 per week) of childcare vouchers, free of tax and national insurance, provided registration has taken place with the childcare provider by 31st March 2011.

Higher rate tax payers who register after 31st March 2011 will only be able to receive up to £124 per month (£28 per week) of childcare vouchers, free of tax and national insurance.

From 6th April 2011 earnings will be estimated at the time of joining the scheme and at the start of each tax year and eligibility will be calculated at that point. If an employee’s earnings change during the tax year, the childcare vouchers will only be affected from the start of the next tax year.

Savings on tax and national insurance, the amount of saving will depend on the amount of childcare vouchers ordered and the amount of tax and national insurance normally paid. The childcare voucher provider will have a calculator to enable an individual savings calculation to be made.

Refunds

Due to HMRC regulations, refunds will not be permitted unless:

  1. The childcare provider declines the vouchers, or
  2. They have not been used as a result of exceptional and unforeseen circumstances

BSU will require evidence that (1) or (2) have occurred and it will be at the discretion of the Director of Human Resources or the Head of Finance as to whether employer agreement will be given.

Leaving employment

Access to childcare vouchers already claimed will remain until the account balance is zero.

The full amount of childcare vouchers can be claimed in the final pay period, subject to there being sufficient pay to cover the voucher, in which case the amount will be restricted.

General

If BSU decides to no longer participate in a childcare voucher scheme, existing salary sacrifice agreements will continue until their expiry date. After which the salary sacrifice will not be renewed

If BSU decides to transfer to a new provider of childcare vouchers, existing salary sacrifice agreements will continue until their expiry date. After which, employee’s will be able to choose to cease their agreement or to move onto the changed scheme.

Employees who currently participate in the Oak Tree Day Nursery salary sacrifice scheme cannot also receive childcare vouchers from the childcare voucher provider. For more information on this scheme please contact the Oak Tree Day Nursery Manager.