The Income Tax (Qualifying Child Care) Regulations 2008

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations amend sections 318(5) and 318C of the Income Tax (Earnings and Pensions) Act 2003 (“ITEPA”) which provide for exemptions from income tax for employee benefits in respect of certain employer-provided or employer-contracted child care.

Regulation 2 makes the amendments to section 318(5) of ITEPA.

Regulation 2(a) inserts a new paragraph (za) so that applicable registration requirements in England include the new registration requirements under Part 3 of the Childcare Act 2006.

Regulation 2(b) amends paragraph (a) to refer only to the registration requirements relevant to Wales.

Regulation 3 makes the amendments to section 318C of ITEPA.

Regulation 3(2)(a) repeals subsection (2)(b) because Schedule 9A to the Children Act 1989 was amended by paragraph 18 of Schedule 2 to the Childcare Act 2006 so that it no longer applies to England. This means that care provided in an appropriate children’s home, a care home, as a patient in a hospital and in a residential family centre will no longer be “qualifying child care”.

Regulation 3(2)(b) inserts a new paragraph (ba) in subsection (2) so that care provided in England by a person registered under Part 3 of the Childcare Act 2006 is “qualifying child care”.

Regulation 3(2)(c) replaces subsection (2)(c) with a reference to care provided by or under the direction of the proprietor of a school on the school premises, subject to the limitations in new subsection (2B). This is intended to clarify the care provided by schools that is “qualifying child care”. The reference to the proprietor of a school reflects the terms of the exemptions for schools from the registration requirements under Part 3 of the Childcare Act 2006.

Regulation 3(2)(d) repeals subsection (2)(eb) because the Childcare (Voluntary Registration) Regulations 2007 (S.I. 2007/730) have been revoked by regulation 3 of the Childcare (General Childcare Register) Regulations 2008 (S.I. 2008/975).

Regulation 3(2)(e) amends subsection (2) by inserting a new paragraph (g) so that qualifying child care includes child care provided by foster parents in England other than to children that they are fostering.

Regulation 3(3) inserts a new subsection (2A) defining “proprietor”, “school” and “school premises” for the purpose of the new subsection (2)(c).

It also inserts a new subsection (2B) limiting the care that is qualifying child care under subsection (2)(c). This excludes care provided during school hours for a child who has reached compulsory school age, reflecting the definition of “childcare” in section 18(3)(a) of the Childcare Act 2006. It also excludes care provided in breach of a requirement to register under Part 3 of the Childcare Act 2006.

Regulation 3(4) amends subsection (3) by inserting a new paragraph (g) so that qualifying child care includes child care provided by foster parents in Wales other than to children that they are fostering.

An Impact Assessment has not been produced for this instrument as no impact on the private or voluntary sectors is foreseen.