Workplace nurseries – Tax Exemption

Below is an extract from the HMRC website regarding Workplace nurseries, what is exempt and not classed as a benefit. If schools and settings follow this process there is no need to declare a benefit. However, if the below exemption doesn’t fit a school/setting scenario and the salary sacrifice (Computershare childcare voucher) scheme is not relevant, then there may be a P11d implication if the employees are provided with childcare free of charge or at a reduced rate.

From HMRC:

If you provide places for employees’ children in a workplace nursery, you don’t have to report or pay anything. To be exempt, a workplace nursery must:

  • have the appropriate registrations and approvals
  • be available to all your employees
  • provide childcare for your employees’ children, or children they have parental responsibility for
  • provide childcare up to the maximum age its registration and approval allows for

The nursery doesn’t have to be at the workplace – it can be in other premises that you manage and finance, as long as they’re not a private residence.

Please contact HMRC if you have any queries.