Childcare Vouchers

Childcare Vouchers

You support your staff, we support you

You have better things to do with your time than spend it administering your scheme, that's why our childcare voucher scheme is different – it’s designed to save you time. You enjoy dedicated support when you need it. And you can manage the whole process online.

About Sodexo Childcare Voucher Service

You have better things to do with your time than spend it administering your scheme, that's why our childcare voucher scheme is different – it’s designed to save you time. You enjoy dedicated support when you need it. And you can manage the whole process online.

Sodexo’s childcare voucher portal automates and simplifies your childcare voucher administration and gives you quick online access to all the information you need. Not only will you save time and money – you will free yourself up for more important matters.

So, whether you are looking to switch childcare voucher provider or start a new scheme, our childcare voucher service can work for you and your employees.

What’s more, our easy to use service can be integrated with any flexible benefit provider platform and we proactively work with you to grow your scheme.

 

Contact us now to start your Sodexo childcare voucher scheme

Why choose Childcare Vouchers by Sodexo? 

Not all childcare voucher providers are the same and with Sodexo:

  • You’ll receive updates on HMRC changes on legislation from our in house expert.
  • Your employees' money is securely looked after in the best rated banks.
  • We are a founding member of the Childcare Voucher Providers Association – so our scheme meets strict industry codes of practice.
  • You can manage every aspect of your account online – quickly and easily.
  • You can count on excellent service and support – we’ve been running childcare voucher schemes for over 10 years.
  • We help you grow your scheme more than our competitors by supplying you with posters, brochures, intranet banners, email templates and much more. We have 30% more working parents on our scheme than the industry average.
  • We help your employees' money go further by offering them unique discounts on childcare, family activities and treats for them.
  • Each year you could save up to £402 per employee on NI contributions – and your staff could save up to £933 per year on childcare costs.

Get your Sodexo childcare voucher scheme started today >>

Why should you switch to Sodexo?

If you feel your current childcare voucher scheme is taking up too much of your time, isn’t providing value for money and you don’t think you are getting up-to-date and reliable HMRC advice then switch to Sodexo in just 24 hours.

We’ve been running childcare voucher schemes for over 10 years and provide a dedicated personal service built around your needs. It’ll take us 24hrs to set up your new scheme, and we’ll provide support at every stage of the process.

More reasons to switch today

  • You’ll receive updates on HMRC legislation changes from our in house expert.
  • Your employees' money is securely looked after in the best rated banks.
  • We are a founding member of the Childcare Voucher Providers Association – so our scheme meets strict industry codes of practice.
  • You can manage every aspect of your account online – quickly and easily.
  • You can count on excellent service and support.
  • We’ll supply posters and other marketing material to help you promote your scheme internally.

Switch now >

  1. What are childcare vouchers?
  2. What types of childcare schemes are there?
  3. How much does the Childcare Vouchers by Sodexo service cost?
  4. What will happen when the scheme changes in 2017?
  5. Will you keep me informed about any changes in childcare legislation?
  6. What is salary sacrifice and how does it work?
  7. What is a benefit in kind scheme?
  8. Is there any effect on Working Tax Credit or Child Tax Credit?
  9. What is the maximum amount of vouchers an employee can take?
  10. How can I contact you?
  11. What should the payslip show?
  12. What information do you offer employees?
  13. Is there any effect on Statutory Maternity or Paternity pay?
  14. How much money could my business save?
  15. Why should I use childcare vouchers by Sodexo?
  16. How long does it take to set up a scheme with Sodexo?
  17. Is there any effect on overtime payments?
  18. Can my employees use any type of childcare?
  19. Can employees be reimbursed for unused vouchers?
  20. How do I make payments?
  21. What do I need to demonstrate to HM Revenue & Customs when running a childcare voucher scheme
  22. Is there a minimum number of employees required?
  23. Are childcare vouchers available for the self-employed?
  24. Do the vouchers have an expiry date?
  25. What if the vouchers expire?
  26. How do vouchers save employees money?
  27. Does it matter how much an employee earns?
  28. How do e-vouchers work?
  29. How and when do I order childcare vouchers for my employees?
  30. Why should I introduce childcare vouchers into my organisation?
  31. Can I offer an employee more than the tax exemption amounts?
  32. When do I have to pay?
  33. Does the scheme differ if employees are paid weekly or fortnightly?
  34. Can anyone apply for and use childcare vouchers?
  35. Can I cancel employee vouchers?
  36. How will I know that my order has been received?
  37. Can employees leave the scheme?
  38. Are pension scheme contributions affected?
  39. Can I place a standing order for vouchers?
  40. Are e-vouchers secure?
  41. How do the schemes differ operationally?
  42. Can an employee backdate childcare vouchers if they join part way through the tax year?

What are childcare vouchers?

Childcare vouchers are a government-led initiative to encourage employers to help working parents with their childcare costs. By running a childcare voucher scheme, you save on Employer NI Contributions and enable employees to save on tax and NI Contributions too.

This Sodexo Benefits and Rewards service helps employers to set up and run a scheme through our online system. Vouchers are ordered and used by employees to pay for their childcare arrangements. 

What types of childcare schemes are there?

Childcare vouchers can be offered to your employees in three ways:

1. As a straight benefit (benefit in kind) where the employer provides the employees with childcare vouchers on top of their normal salary.

2. As a solo salary sacrifice scheme where employees nominate to take part of their salary as childcare vouchers.

3. As part of a benefits scheme where employees either nominate to take childcare vouchers in place of an alternative benefit, fixed benefit allowance or as part of a salary sacrifice. Our service is modelled on the salary sacrifice option. If you wish to run the scheme as a benefit in kind scheme, please contact us for further advice.

How much does the Childcare Vouchers by Sodexo service cost?

The management fee charged by Sodexo Benefits and Rewards Services for the administration and processing of vouchers is a percentage fee, based on the face value of the vouchers ordered.

What will happen when the scheme changes in 2017?

In early 2017, the Government is planning to begin a phased roll-out of Tax-Free Childcare, a new initiative for working parents which will replace the current Childcare Voucher Scheme. If you currently offer Childcare Vouchers to your employees you can continue to do so, but you won’t be able to accept new joiners after April 2018.

In a recent study of over 7,500 working parents, 66% are more likely to be better off with Childcare Vouchers than they would be with Tax-Free Childcare, so keeping your scheme open to existing users is important.

For more information about the new scheme, visit our Tax-Free Childcare Info Hub.

Will you keep me informed about any changes in childcare legislation?

Sodexo Benefits and Rewards Services will keep you updated on all developments via the Sodexo childcare voucher portal and through our bi-monthly client newsletter.

What is salary sacrifice and how does it work?

Salary Sacrifice involves the employee agreeing to formally give up some of their existing taxable salary, in return for financial gain. In the case of childcare vouchers, this is a tax and NI exemption and requires paperwork to show a variation to an employee’s terms of employment.

Employees must agree to a formal revision of their contract of employment. It must be indicated that the employee is legally entitled to a lower cash salary plus the childcare vouchers. The employee must sign a document agreeing to the new contractual terms proposed by you. As part of the service we provide a standard Salary Sacrifice Agreement for you to use

What is a benefit in kind scheme?

A benefit in kind scheme involves the employer giving childcare vouchers to employees on top of their salary. In this case, the vouchers are still free and the employee saves on Tax and NI contributions.

 The amounts that your employees can take in childcare vouchers without paying tax and NI depends on their earnings and the threshold they come under according to their Basic Earnings Assessment (BEA).

Changes to childcare voucher entitlements and eligibility will come into effect from April. This may affect which earnings threshold you fall into and, as a result, may alter the maximum amount you can take in childcare vouchers. Please see below the eligibility brackets as of April 2016.

  Maximum Voucher Allowance  
Total Earnings*/Rate Weekly Monthly Yearly

Max savings per Annum

Basic Rate £0-£43,000 £55 £243 £2,915 £933
Higher Rate £43,000-£150,000 £28 £124 £1,484 £623
Additional Rate Over £150,000 £25 £110 £1,325 £622

 

 

 

 

 

 

 

 

 

* Total earnings includes salary, other taxable benefits and allowances.

Any amount over the amounts stated above is liable to tax and NI Contributions.

Is there any effect on Working Tax Credit or Child Tax Credit?

There may be an effect on Tax Credits. Sodexo Benefits and Rewards Services cannot comment on individual circumstances and it is the individual’s decision as to whether they wish to take childcare vouchers.

It is advisable for employees to contact the Tax Credits helpline on 0345 300 3900 prior to applying for childcare vouchers, to establish individual circumstances. Alternatively, HM Revenue & Customs have an online tool to help parents decide whether they will be better off with childcare vouchers. Please visit the HMRC's Childcare Indicator for more information.

What is the maximum amount of vouchers an employee can take?

The table below shows the maximum amount your employees can take per week, per month, and per year in childcare vouchers free from tax and National Insurance contributions. Any amount over this attracts Employer NI and tax and National Insurance for employees.

Changes to childcare voucher entitlements and eligibility will come into effect from April. This may affect which earnings threshold you fall into and, as a result, may alter the maximum amount you can take in childcare vouchers. Please see below the eligibility brackets as of April 2016.

  Maximum Voucher Allowance  
Total Earnings*/Rate Weekly Monthly Yearly

Max savings per Annum

Basic Rate £0-£43,000 £55 £243 £2,915 £933
Higher Rate £43,000-£150,000 £28 £124 £1,484 £623
Additional Rate Over £150,000 £25 £110 £1,325 £622

 

 

 

 

 

 

 

 

 

* Total earnings includes salary, other taxable benefits and allowances.

How can I contact you?

Whether you would like further advice or information or would like to share your feedback on the scheme, please get in touch with the team.

Email: customercare.br.uk@sodexo.com

Phone: 0800 328 7411*

Address:
Sodexo Benefits and Rewards Services,
Unit 5 Albany Court,
Albany Park,
Frimley Road,
Camberley,
Surrey
GU16 7QR

*Please note all calls are recorded for training and quality purposes.

What should the payslip show?

The vouchers do not need to appear on an employee’s payslip at all, however, most employees do prefer to see their total salary package.

If the vouchers are shown, the original (pre-sacrifice) figure should be referred to, with the voucher amount shown as a ‘negative allowance’.

What information do you offer employees?

The help button on the childcare voucher portal site has a section where you can find information on supporting and growing your scheme.

The help section provides several sources of information for your employees. These documents address most employee questions and concerns. In addition to this Employees can visit the Employee specific area, in the childcare voucher section of the Sodexo Benefits and Rewards Services website: uk.benefits-rewards.sodexo.com/employee/childcare-vouchers. They can also contact the Customer Care team at customercare.br.uk@sodexo.com or by telephone on 0800 328 7411.

Download materials >

Is there any effect on Statutory Maternity or Paternity pay?

If an employee takes childcare vouchers when her Statutory Maternity Pay (SMP) or Statutory Adoption Pay (SAP) is being calculated (approx. weeks 17-24 of pregnancy), then her SMP/SAP may be affected. For this reason they may wish to suspend scheme membership during the qualifying period and then re-join the scheme afterwards.
 
If an employee is taking childcare vouchers when they go on maternity or adoption leave and they will be receiving contractual maternity or adoption pay, then their salary sacrifice can continue as usual until the employee reverts to SMP/SAP. Childcare vouchers cannot be deducted from SMP/SAP. At this point the employee may take a break from receiving childcare vouchers until she returns to work. (As long as the employee resumes her childcare voucher claim within 12 months, it will not be considered a new claim).
 
Statutory Paternity Pay is not affected.

How much money could my business save?

By offering childcare vouchers through a salary sacrifice or benefit in kind scheme, you save on Employer NI. The amount you save will depend on your employees’ pension status, but you could save up to £402 per employee per year.

As well as the financial savings, employers should also be aware of the potential savings to be made in terms of staff recruitment and retention.

Why should I use childcare vouchers by Sodexo?

Our service offers you the opportunity to enhance your employees’ benefits with minimal fuss, thanks to an easy to use online system. Our expert team are always on hand to offer support and advice to make the scheme a success.

Our Childcare voucher service has been designed and developed by Sodexo Benefits and Rewards Services - a voucher expert with over 30 years’ experience in 27 countries. Sodexo Benefits and Rewards Services recognises that the help and advice we offer needs to be accurate and timely and we ensure our childcare voucher service adheres to all HM Revenue & Customs guidelines.

How long does it take to set up a scheme with Sodexo?

Our childcare voucher service can be set up quickly and easily online, usually within 24 hours. Once your organisation and employees are registered with Sodexo, you can place your first voucher order. We need to receive it at least five working days before the required delivery date.

HMRC allows employees to receive vouchers before their childcare provider is registered with Sodexo Benefits and Rewards Services. However, childcare providers must be registered before we can allow parents to make payments to them.

Is there any effect on overtime payments?

Most work benefits are calculated on gross salary, so overtime or other benefits should not be affected.

Can my employees use any type of childcare?

Employees can only pay for Ofsted (or equivalent) registered childcare, up to the age of 15 with their vouchers. This may include breakfast clubs, after school clubs, nurseries, childminders, after school activities, holiday camps and certain elements of independent school fees.  Please refer to the childcare provider section for more information.

Can employees be reimbursed for unused vouchers?

It is your decision as an employer whether an employee can be reimbursed for unused vouchers.

If you agree to this, you should email the Customer Care team at customercare.br.uk@sodexo.com and ask for a copy of the Childcare Voucher Cancellation Request to be sent to you for completion.

How do I make payments?

You can make payments either by Direct Debit or BACS transfer. Weekly and fortnightly orders must be paid by Direct Debit to tie in with payment schedules of vouchers.

As Direct Debits can take up to 10 working days to set up, you may have to pay for your first order using an alternative method of payment. Your invoice will state whether payment of your invoice will be collected by Direct Debit.

What do I need to demonstrate to HM Revenue & Customs when running a childcare voucher scheme?

HM Revenue & Customs need to be satisfied that the scheme you are running complies with the rules of salary sacrifice. You must keep records to demonstrate the following:

  • That the scheme is available to all employees - keep a record of the material used to promote the scheme to enable you to do this.
  • That the child qualifies for the scheme - keep a record of the child’s date of birth and a note of the relationship between the employee and child. Our standard Salary Sacrifice Agreement fulfils this function.
  • The childcare is registered - keep a copy of your scheme rules that includes a requirement for employees to notify you of any change in circumstances in relation to the child or childcare. You should also make a record of the carer’s name and registration or approval number and a note of when the carer’s approval is due to expire. 

Is there a minimum number of employees required?

There is no minimum number of employees required to set up a childcare voucher scheme. Even having one employee on the scheme will create savings.

Are childcare vouchers available for the self-employed?

Presently the government doesn’t allow self-employed parents to take part in employer-supported childcare voucher schemes. This is because they do not pay tax under PAYE, so are not entitled to the savings on tax and NI contributions of childcare vouchers.

At Sodexo we are currently lobbying the government to allow childcare vouchers to be extended to self-employed parents. To find out more visit the news section.

Do the vouchers have an expiry date?

Childcare vouchers are valid for up to 18 months after the date of issue. Therefore employees can save them up to use at times when they may need extra childcare throughout the year, allowing vouchers to be used for holiday clubs and summer camps.

What if the vouchers expire?

Vouchers are valid for up to 18 months, so employees can save them up for times when they may need extra childcare throughout the year. Expiry dates of vouchers are available through the Childcare Portal. All vouchers expire on their expiry date and employees must use the vouchers before they expire. Expired vouchers may be replaced on request - employees should contact the Customer Care team at Sodexo for further information. 

How do vouchers save employees money?

By taking childcare vouchers, employees save the tax and NI Contributions on the amount of vouchers they take. The amount an employee saves depends on the rate of tax and NI they pay and the amount of vouchers they take.

Does it matter how much an employee earns?

You must ensure that employees’ net pay (salary after vouchers) does not go below the Lower Earnings Limit (LEL). This is to ensure the minimum amount of NI is paid and that employees’ state benefits, such as Statutory Sick Pay, are not affected. Employees must also remain above National Minimum Wage / National Living Wage after salary sacrifice.

How do e-vouchers work?

E-vouchers work in a similar way to online banking. Parents are assigned a personal e-voucher account through which they arrange payments directly into their carer’s bank account. Parents can easily monitor the payments they’ve made. 

How and when do I order childcare vouchers for my employees?

Orders are made using your online portal. They are usually organised to coincide with your business’ pay periods – for example, weekly, fortnightly, four weekly or by calendar month. Orders must be placed for each pay period – if Sodexo Benefits and Rewards Services does not receive an order, vouchers will not be credited to parents.

Employers select the employees that they wish to include on the order and the delivery date (the date employees are to receive the vouchers) to submit the order.

Orders must be sent a minimum of five working days before the date they are required to be credited into employees’ e-voucher accounts.

Why should I introduce childcare vouchers into my organisation?

There are lots of reasons to consider childcare vouchers:

  • Employer NI savings of up to £402 per employee per year.
  • Brings genuine financial benefit to employees – saving up to £933 per year, per employee.
  • Helps employees budget for childcare.
  • An excellent way to recruit and retain staff.
  • Simple to implement.
  • A flexible service that suits your organisational needs.

Find out more about the benefits other employers have seen in our case studies.

Can I offer an employee more than the tax exemption amounts?

It is up to you as an employer whether you wish to allow employees to have more than the tax exemption amount. Employees will have to pay tax and NI on the additional amount.

When do I have to pay?

Electronic invoices are issued within 24 hours of processing your order. We require payment before vouchers will be credited. Payment terms for the management fee plus VAT are due the later of either 14 days from the invoice issue date or from the voucher credit date.

Orders must still be placed at least five working days before payday and an order must be received for each pay period. If you are ordering childcare vouchers for weekly and fortnightly paid staff, you must pay by Direct Debit.

Can anyone apply for and use childcare vouchers?

To receive and use childcare vouchers, the employee must either be the parent or have parental responsibility for a child. Childcare vouchers can be used to pay for care of a child up to 1st September following the child’s 15th birthday or 1st September following their 16th birthday if the child is disabled.

Childcare vouchers must be used to pay for registered or approved childcare. See HM Revenue & Customs website for more details on the rules regulating the scheme.

Can I cancel employee vouchers?

Yes, vouchers can be cancelled at any time before being spent. A credit note will be issued for the face value of the unspent vouchers.

How will I know that my order has been received?

You will receive an automatic email once processing is under way. You will be able to see online that your order has been submitted.

Can employees leave the scheme?

HMRC guidance suggests that employees can leave the scheme at any time. However, we ask that employees stay for a minimum of one month to avoid unnecessary administration.

Are pension scheme contributions affected?

This depends on your pension scheme. Most pension providers are happy to accept vouchers as notional pay. Sodexo Benefits and Rewards Services recommends that you check with your pension provider prior to putting a scheme in place.

Can I place a standing order for vouchers?

You cannot place a standing order as, like payroll, every order for childcare vouchers is treated separately. If we do not receive an order for a pay period, vouchers will not be credited.

Are e-vouchers secure?

E-vouchers are fully secure. Employees use their user name and password to log in. Security information is also provided which is requested if an employee calls the customer care team at Sodexo Benefits and Rewards Services.

How do the schemes differ operationally?

In a benefit in kind scheme, employers fund childcare vouchers for employees rather than employees sacrificing part of their salary for vouchers.

All of the guidance contained on this site is the same for both Salary Sacrifice and benefit in kind schemes, except for the Salary Sacrifice Agreement which does not apply for employees taking part in a benefit in kind scheme. We are happy to provide alternative documentation and advice for setting up a scheme on the benefit in kind model, please contact us to find out more.

Can an employee backdate childcare vouchers if they join part way through the tax year?

HMRC does allow working parents to backdate vouchers under certain circumstances within a tax year, but this is at your discretion.

The childcare voucher tax and NI ‘exempt amount’ is an annual allowance and therefore, as long as the employee earns the annual voucher allowance PLUS National Minimum Wage/ National Living Wage within that tax year, it is possible for them to backdate vouchers up to the full childcare voucher allowance for that year. However, you must be satisfied that they met all of the necessary conditions for scheme membership in each week or month that they wish to receive backdated vouchers for, (for example, their child must have been born/ they must have been in your employment/ you must have had a scheme in place).
 

In early 2017, the Government is planning to begin a phased roll-out of Tax-Free Childcare (TFC). As a result of this, the current Employer Supported Childcare Voucher Scheme will be closing to new entrants in April 2018. If you already offer childcare vouchers you can continue to do so until the scheme is no longer required by its existing members. However, you won’t be able to accept new joiners after the 2018 cut-off.

Employees who are already taking childcare vouchers will be able to choose the scheme that suits their family better. In a recent study of more than 5,000 working parents, 66%* are more likely to be better off with childcare vouchers than they would be with Tax-Free Childcare, so if you don’t currently offer a scheme, now is a great time to sign up

Childcare Savings Calculator

Help employees find out which scheme could save them the most money with our quick Childcare Savings Calculator.

Tax-Free Childcare Communication Toolkit

Despite 90% of our clients having heard of Tax-Free Childcare, less than half of parents are aware of the proposed changes. We have therefore put together a toolkit to help you communicate the changes to your employees to ensure they have all of the information they need to make the right decision for their family. Download the toolkit >

For more information about the government’s proposed Tax-Free Childcare Scheme, visit www.tax-free-childcare.info

 

*Sodexo survey of over 5000 parents, 2015

Latest News

17/06/2016 | A changing childcare landscape white paper

Helping employee's navigate through a changing childcare landscape
Read more

Contact customer service 0800 328 74 11

marketing.​br.​uk@​sodexo.​com
Testimonials

Really useful toolkit to help promote the scheme

We have worked with Sodexo as our childcare voucher provider for a number of years. They have streamlined our transition onto their online system with great support and little impact to our employees. Our Account Manager holds regular reviews with us to see how our scheme is performing and how we can improve take up of the scheme. They have a really useful toolkit that we utilise for promotion of the scheme throughout the year. They assisted us with the 2011 changes and are continuing to assist us with the upcoming 2017 changes. It’s great to know they are at the end of the phone, or an email away should we have any concerns or issues.

Reward Administrator Premier Farnell plc