On the 6th of April 2005 the government introduced tax and NI contribution exemptions on childcare costs to encourage companies to assist their employees with childcare fees. As working parents are increasingly juggling the demands of both work and home, and finding it difficult to find affordable childcare, the childcare voucher benefit has a direct impact on the working life of both mothers and fathers.

By offering a childcare voucher scheme, employees are able to receive £55 a week (£243 per month) in childcare vouchers, which will be exempt from tax and NI. This means that employees can save either £903 per year as a 20% taxpayer or £1195 per year as a 40% taxpayer. If both parents take up the benefit from their respective employers then saving of nearly £2400 are possible. In today's economic climate, savings of this level have a huge impact.

The amount paid out by a company in vouchers is then also exempt from employers' NI contributions. Any small business employers offering this benefit will make savings in employers national insurance of around £227 per year per employee. There is still a misconception that childcare voucher schemes are designed for bigger companies who have a large percentage of working parents to cater for, plus a large HR department to deal with the expected extra workload.

However, in reality, companies of all sizes, including SMEs with only one or two people on the scheme can benefit from using childcare vouchers.

The amount paid out by a company in vouchers is also exempt from employers' NI contributions
"There is an assumption that implementing a childcare voucher scheme will be very complex and employers are afraid that they will have to dedicate a section of their HR department to deal with the running of it," explained Amanda Ward, Director of Early Years Vouchers Ltd.

"I believe that if employers knew how simple it really is, including how much of the leg-work is done by us, plus the financial and social benefits to them as a business, they wouldn't think twice about signing up."

In the past two months, Early Years Vouchers Ltd has seen a five-fold increase in the number of companies signing up to its childcare voucher scheme, which allows working Mums and Dads to benefit from savings on the cost of all forms of child care. These vouchers are a vital help to parents in offsetting the rising cost of living.

"We've seen a big increase in companies offering the childcare voucher benefit because employers and employees alike are using every avenue available to save money," said Amanda.

"I believe as we enter into an uncertain 2009 that number will continue to increase. Savings on essentials like childcare can make a big difference to family and working life. Employers are looking into ways they can be more compassionate, offering a better work-life balance to their employees, especially with increased costs of living."

Vouchers can be used to pay for all forms of childcare from birth up to the age of 15. So if you have employees who are using a nursery, a nanny, childminder or even breakfast clubs and after school clubs and holiday clubs for older children then by offering vouchers, you will be helping them considerably.

Early Years Vouchers ltd are a privately owned company that are dedicated to providing a level of service that exactly meets your company's needs. We do the legwork and provide your business with the key documents you will need in-house to run the benefit and we can also undertake one-to-ones with your staff if required.

We offer your employees complete flexibility in the choice of how they wish to take the benefit either as an e voucher, paper voucher, as an automatic payment to their childcare provider or as a credit on their account to pay for future childcare costs. Importantly, we also make the task of redeeming vouchers and reconciling payments from parents very easy and trackable.

For more information visit www.childcare-vouchers.net or call 0845 0945 805