Childminding: Tax Allowances
The question
To ask the Chancellor of the Exchequer, what steps the Government is taking to protect the tax relief available to childminders under the current HMRC expenses agreement in light of the move Making Tax Digital, including the wear-and-tear allowance; and whether prior consultation will be issued before any changes.
Answered by Dan Tomlinson
At Budget 2025 the Government confirmed that the standard rules for calculating income tax would apply to childminders who are mandated into Making Tax Digital (MTD). We will phase in this change between 2026 and 2028, in line with the MTD income thresholds.
Childminders can continue to claim tax relief for wear and tear by deducting the actual cost of buying, repairing or replacing items. They can also deduct the cost of business expenses such as utilities, cleaning and equipment. This ensures childminders receive tax relief for all of the costs that they incur in relation to their childminding business.
HMRC engaged with stakeholders, including Coram PACEY, on these changes before the Budget, and are actively working with them to help childminders with the transition, answer any queries they may have, and produce updated guidance in early 2026.
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