Childcare funding rules can change. This guide reflects the arrangements in England as of September 2026. Scotland, Wales and Northern Ireland have different schemes.
Understanding childcare funding should be simple. In practice, parents are often faced with phrases such as “30 hours”, “term-time funding”, “eligibility codes” and “Tax-Free Childcare” without a clear explanation of how they fit together.
The most important thing to know is that there is no single childcare funding scheme. Your family may qualify for funded childcare hours, help through Universal Credit, Tax-Free Childcare or a combination of support. What you can receive depends on your child’s age, your work and income, and sometimes your child’s circumstances.
This guide explains the main options in plain English, including when funding starts, what it actually pays for and why a nursery bill may not fall to zero even when your child receives 30 funded hours.
The short version: what help might your family receive?
There are three main age-based funded childcare entitlements in England.
Eligible working parents can receive up to 30 funded hours a week for a child aged from nine months until they start school. The hours are normally calculated over 38 weeks of the year.
All three- and four-year-olds in England can receive 15 funded hours a week, regardless of whether their parents work. Some two-year-olds can also receive 15 hours if their family receives particular benefits or the child meets certain additional criteria.
Alongside these hours, working families may be able to use Tax-Free Childcare to reduce the cost of additional childcare. Families receiving Universal Credit may instead be able to claim back up to 85% of eligible childcare costs.
Although several forms of help can sit alongside funded hours, you cannot usually use Tax-Free Childcare and the Universal Credit childcare element at the same time. It is therefore worth using the official childcare support calculator before deciding which option is better for your household.
30 hours for eligible working parents
Eligible working parents in England can receive 30 hours of funded childcare a week for a child aged between nine months and four years. Funding begins from the relevant term after the child reaches the qualifying age and normally continues until the child starts Reception.
Despite commonly being called “30 free hours”, the entitlement is more accurately described as 1,140 funded hours a year. The headline figure assumes that these hours are used as 30 hours a week during 38 term-time weeks.
Parents do not have to use all 30 hours. You might use 18 hours because that is all you need, or split the entitlement between two participating providers. However, the combined funded hours claimed across all providers cannot exceed your entitlement.
To qualify, you and your partner, if you have one, must normally both be working or about to start work. Employment, self-employment and work as a company director can count. Certain types of paid or statutory leave can count too, including maternity, paternity, adoption, shared parental, sick and annual leave.
Each parent must usually expect to earn at least the equivalent of 16 hours a week at the applicable National Minimum Wage or National Living Wage over the following three months. The exact cash threshold changes when minimum wage rates change, so it is better to check the current eligibility amounts on GOV.UK rather than relying on an old figure.
There is also an upper income limit. You will not qualify if either parent expects to have an adjusted net income above £100,000 in the current tax year. This is an individual limit, rather than a combined household limit. A couple earning £70,000 each may therefore qualify, while a household in which one parent earns more than £100,000 may not.
Some families can qualify where one parent works and the other receives an eligible benefit because they are disabled, have limited capability for work or have caring responsibilities. Newly self-employed parents may also be treated differently during the first 12 months of their business.
Example: Priya and Daniel have a 14-month-old daughter. Priya works four days a week and Daniel works full-time. Both meet the minimum earnings test and neither has adjusted net income above £100,000. Their daughter can receive up to 30 funded hours a week during 38 weeks of the year, subject to them applying on time and finding a provider offering suitable funded places.
The universal 15 hours for three- and four-year-olds
Every three- and four-year-old living in England is entitled to 570 hours of funded early education each year. This is usually offered as 15 hours a week for 38 weeks, beginning from the term after the child’s third birthday.
This part of the system is sometimes called the universal entitlement because parents do not have to meet a work or earnings test. It is available whether you work full-time, part-time, are studying, are looking for work or are not currently employed.
The normal starting dates are:
- A child who turns three between 1 September and 31 December can receive the hours from 1 January.
- A child who turns three between 1 January and 31 March can receive them from 1 April.
- A child who turns three between 1 April and 31 August can receive them from 1 September.
This can cause understandable confusion. A child does not usually become funded on their third birthday. For example, if Ella turns three on 10 April, her universal entitlement will normally begin from the following September term.
Parents do not normally apply through the same HMRC childcare account used for the working-parent entitlement. Instead, you should speak to your nursery, preschool, childminder or local authority. The provider will usually ask for information such as your child’s date of birth and may need to see supporting documents.
A working family with an eligible three- or four-year-old does not receive 15 universal hours plus a separate 30 hours. The working-parent entitlement brings the total to a maximum of 30 hours a week during term time.
15 hours for some two-year-olds receiving additional support
A separate 15-hour entitlement is available to some two-year-olds whose families receive particular forms of support. Eligibility may be based on benefits and household income, but it is not limited to financial circumstances.
A child may also qualify if they have an education, health and care plan, receive Disability Living Allowance, are looked after by a local authority or have left care under certain arrangements, such as an adoption order, special guardianship order or child arrangements order.
This entitlement can be especially important for families who do not meet the working-parent rules. For example, a parent who is not currently working may still secure a funded early education place for an eligible two-year-old.
The application process varies between local authorities. Some councils provide an online checker, while others ask parents to contact their Family Information Service or early years team. You can find your local council on GOV.UK and ask specifically about funded early learning for two-year-olds.
If your two-year-old qualifies through the additional-support route and you are also eligible as a working parent, speak to your local authority and provider about which entitlement should be recorded. You cannot claim two sets of funded hours for the same period, but the way your place is administered can matter if your circumstances later change.
When funded childcare starts and why deadlines matter
Funded hours normally begin at the start of one of three funding periods: January, April or September. This means a child may be old enough for the working-parent scheme but still have to wait until the next period begins.
For the working-parent entitlement, the usual pattern is:
- If your child turns nine months between 1 September and 31 December, funding can begin from 1 January. Apply by 31 December.
- If your child turns nine months between 1 January and 31 March, funding can begin from 1 April. Apply by 31 March.
- If your child turns nine months between 1 April and 31 August, funding can begin from 1 September. Apply by 31 August.
You can normally apply once your baby is 23 weeks old. It is sensible not to leave the application until the final evening. If HMRC needs further information, or you make a mistake and miss the deadline, you may have to wait until the following funding period. Your provider is not normally able to backdate the funded place simply because your child was otherwise eligible.
Starting or returning to work has its own timing rules. Depending on the term, parents can usually apply where they are due to start or return to work within a specified period. Paid annual leave can count as having returned to work. The official application timing guide explains the current dates for parents returning from maternity, paternity, shared parental or adoption leave.
There is another practical deadline that is just as important: the nursery’s own admissions timetable. Receiving an eligibility code does not automatically reserve a childcare place. Popular settings may have waiting lists many months long, so it is worth discussing availability before your funded term begins.
If you are still comparing settings, our practical guide to choosing a nursery explains what to look for during visits and which questions are useful to ask.
How to apply for working-parent childcare funding
You apply for the working-parent entitlement through the government’s online childcare service. The application normally creates a childcare account, which can also be used for Tax-Free Childcare if you qualify.
You will need your National Insurance number and, if you are self-employed, your Unique Taxpayer Reference if you have one. You may also need your child’s UK birth certificate reference and details of when you started or expect to start work. If you live with a partner, their circumstances will generally need to be included as well.
When the application is approved, you receive an 11-digit childcare code. Give the code to your chosen provider along with your National Insurance number and your child’s date of birth. The provider uses these details to confirm your eligibility with the local authority.
The code is proof that you qualify for funding, but the nursery or childminder must still confirm that they can offer a funded place on the days and hours you need. One nursery might allow 30 hours to be used across three long days, while another may offer funded sessions only at particular times.
You can apply through GOV.UK. Applications usually take around 20 minutes, although HMRC may ask some parents, including company directors or people with irregular earnings, for further evidence.
After receiving the code, do not assume the job is finished. You must reconfirm your details through your childcare account every three months. HMRC usually sends reminders, but the responsibility remains with you. Setting a calendar reminder a week or two before the reconfirmation date can prevent an avoidable interruption.
What does “30 funded hours” really pay for?
The funded entitlement pays for childcare and early education. It does not necessarily pay for every part of a nursery day, and this is where many families receive an unexpected first invoice.
Providers may charge separately for meals, snacks, nappies, consumables, additional activities, trips and childcare used outside the funded hours. A setting may also structure its day into funded sessions with paid time before, between or after those sessions.
For example, a nursery might be open from 8am until 6pm. A child attends three ten-hour days, but only nine hours of each day are treated as funded. The family pays for the remaining three hours each week, together with meals and consumables. The child is receiving 27 funded hours, but the monthly invoice is not zero.
This does not automatically mean the nursery is doing anything wrong. However, charges should be clear and transparent. Funded hours should not be presented as a cash discount from an inflated fee, and parents should be able to understand which hours are funded and what every additional charge covers.
Before accepting a place, ask the provider for a written illustration of a normal monthly bill. Useful questions include:
- Which exact hours of the day can be funded?
- Can the entitlement be stretched across the year?
- Are meals and consumables optional, and what alternatives are available?
- Is there a minimum number of paid hours or sessions?
- What happens to fees during holidays, closures and bank holidays?
A conversation using real days is often clearer than asking whether the nursery “accepts 30 hours”. For example: “My child needs care from 8am to 5.30pm on Monday, Tuesday and Thursday. Once the funded hours are applied, what would we pay in an average month?”
Term-time hours and stretched funding
The 30-hour offer covers 1,140 hours a year, while the universal 15-hour entitlement covers 570 hours. These figures are based on 38 weeks, not all 52 weeks of the year.
If you need childcare during school holidays, some providers allow the annual hours to be “stretched” across more weeks. Stretching does not give you extra funding. It simply spreads the same number of hours more evenly.
As a rough example, 1,140 hours divided across 51 weeks works out at a little over 22 hours a week. A provider may use a slightly different calculation depending on its opening weeks and local authority arrangements.
Imagine that Marcus attends nursery for 30 hours every week throughout most of the year. His parents could use around 22 funded hours each week under a stretched arrangement and pay for the remaining eight hours. This may produce a steadier monthly bill than receiving 30 funded hours in term time and paying the full cost during the holidays.
Not every provider offers stretched funding, and those that do may calculate it differently. Ask for an annual cost estimate rather than looking only at a single term-time week. This makes it easier to compare settings fairly.
It is also worth asking how funding is handled if your child starts partway through a term, changes setting or attends more than one provider. Local authorities set practical rules for moving funding, and a change made after the term’s headcount date can be more complicated than parents expect.
Tax-Free Childcare and Universal Credit
Funded hours may cover only part of your childcare. Two important schemes can help with the remaining bill, but they work in very different ways.
Tax-Free Childcare
Tax-Free Childcare is not a refund through your tax return. You open an online childcare account and pay money into it. For every £8 you add, the government adds £2, up to the scheme’s limits.
The maximum government contribution is normally £500 every three months for each child, or £2,000 a year. For a disabled child, it can rise to £1,000 every three months, or £4,000 a year.
For example, if the part of your nursery bill not covered by funded hours is £500, you put £400 into the account and the government adds £100. You then pay the provider £500 from the account.
Tax-Free Childcare can be used for more than nursery care. Depending on your child’s age and the provider’s registration, it may also help pay for a registered childminder, nanny, breakfast club, after-school club or holiday club. Your provider must be signed up to receive payments.
You can use Tax-Free Childcare alongside funded childcare hours. You cannot normally use it at the same time as Universal Credit childcare support or tax credits. Full eligibility rules are available in the official Tax-Free Childcare guide.
Universal Credit childcare costs
If you receive Universal Credit and meet the work conditions, you may be able to claim back up to 85% of eligible childcare costs. There is no general minimum number of working hours, although you and a partner who lives with you will usually both need to be working or have a job offer, unless an exception applies.
Universal Credit has monthly maximum limits, which can change over time. Check the current figures and claim process on the GOV.UK childcare costs page.
Universal Credit childcare support can be used for eligible charges that remain after funded hours have been applied. You must report costs correctly and within the required time. If paying childcare upfront would prevent you from starting work, additional help with the initial payment may be available through Universal Credit.
Tax-Free Childcare is not automatically the better option just because it sounds simpler. A family eligible for 85% support through Universal Credit could receive substantially more help than the 20% top-up available through Tax-Free Childcare. Check before opening or switching accounts, particularly if you already receive means-tested benefits.
Choosing a provider that works with your funding
A valid childcare code does not guarantee that every nursery or childminder will offer the pattern you want. Providers can take part in the funded scheme while setting their own admissions arrangements, session times and availability.
When contacting a provider, explain your full requirement rather than asking only whether it offers funded places. Include the days you need, drop-off and collection times, your preferred start date, whether you need holiday care and your child’s age at that point.
Suppose you need three full days because of work. A setting offering five funded morning sessions may technically accept the entitlement but still be impractical for your family. Another setting offering stretched hours over three days could be a much better match even if its published daily fee looks higher.
You may be able to split the entitlement between providers. A child could, for example, attend a preschool for some sessions and a childminder for the rest. Both providers must agree to the arrangement, and you will need to declare how the hours are divided. Think carefully about travel, naps and the number of transitions in your child’s week as well as cost.
Once you have chosen a place, give your child time to settle. Starting childcare can feel like a big change even when the setting is warm and welcoming. If the first few drop-offs are difficult, our guide on what to do when a child cries at nursery drop-off offers practical, reassuring advice.
Common mistakes that can cost parents money
One of the most common mistakes is applying too late. Missing 31 August, 31 December or 31 March by even a short time can delay the start of working-parent funding until the next period.
Another is forgetting to reconfirm eligibility every three months. Even if your job and income have not changed, you must still sign in and confirm that your details remain correct.
Parents also sometimes budget on the assumption that 30 hours means three completely free ten-hour nursery days. Depending on the provider, meals, consumables, additional time and holiday care may remain payable. Always request an example invoice before committing.
If your working pattern, relationship, income or household changes, update your childcare account promptly. Losing eligibility does not always mean that funding stops the next morning; a grace period may apply. However, you should not rely on this without checking the dates shown in your account and speaking to the provider.
Finally, do not assume that being turned down by one nursery means the funding cannot be used elsewhere. The difficulty may be that the setting has no funded places left or cannot offer your preferred schedule. Your local authority’s Family Information Service can help you identify other participating providers.
Frequently asked questions
Does every child in England receive 30 funded hours?
No. The 30-hour entitlement is mainly for eligible working parents and is subject to work, earnings, income and residence conditions. All three- and four-year-olds can receive the universal 15-hour entitlement, regardless of whether their parents work. Some two-year-olds qualify for a separate 15-hour entitlement because their family or the child receives additional support.
Can I get 30 hours as soon as my baby turns nine months?
Usually not on the exact day. Funding begins from the relevant January, April or September period after your child reaches nine months, provided you meet the eligibility rules and apply by the deadline.
Why am I still receiving a nursery bill?
Funded childcare does not necessarily cover meals, nappies, consumables, trips, optional activities or time outside the funded sessions. If funding is stretched across the year, it will also cover fewer hours in an average week. Ask your provider for an itemised explanation if the bill is unclear.
Can a nursery refuse to offer me 30 funded hours?
A provider does not have to offer every available entitlement or every possible pattern of attendance. It may have a limited number of funded places or offer funding only within particular sessions. However, charges and conditions should be explained clearly before you accept the place.
Can I use funded hours with a childminder?
Yes, if the childminder is properly registered and approved to deliver funded early education under the relevant local arrangements. Ask the childminder directly and confirm the position with your local authority if necessary.
Can I divide the hours between two childcare providers?
Often, yes. You may be able to divide funded hours between a nursery, preschool, school nursery or childminder, provided both settings participate and the total claimed does not exceed your entitlement. Local rules may limit how the hours are divided across a day or between providers.
Can grandparents be paid using funded childcare?
You cannot use the working-parent funded hours simply to pay a relative for informal childcare. Tax-Free Childcare has limited circumstances in which a relative may qualify—for example, if they are a registered childminder caring for the child outside the child’s home. Always check the official rules before making arrangements.
Can I use Tax-Free Childcare with the 30 hours?
Yes. Tax-Free Childcare can help pay for approved childcare costs left after the funded hours are applied. For example, it might cover part of your additional nursery hours or registered holiday care.
Can I receive Universal Credit childcare support and Tax-Free Childcare together?
No, not normally. Because choosing or switching schemes can affect your support, use the government childcare calculator or speak to an adviser before making a change.
What happens if I lose my job?
Report the change through your childcare account. You may receive a temporary grace period during which your funded place continues, giving you time to find new work. The end date will depend on your circumstances and the funding period. Your child’s universal 15 hours, once they are aged three or four, is not dependent on you working.
Do I need to reconfirm the universal 15 hours for a three-year-old?
No quarterly HMRC reconfirmation is normally needed for the universal 15-hour entitlement. Reconfirmation applies to the working-parent entitlement and Tax-Free Childcare. Your provider may still ask you to complete local forms or confirm details periodically.
Where can I get help if my application is rejected?
First, check the reason shown in your childcare account and make sure the income, employment and partner information is correct. You can contact the Childcare Service helpline or ask HMRC to review a decision where appropriate. Your local authority’s early years team can help with provider and local funding questions, while Citizens Advice may be useful if the problem is connected to Universal Credit or a change in circumstances.
Childcare funding is easier to manage when you treat it as two separate questions: what support is your family entitled to, and how does your chosen provider deliver it? Check both early, ask for costs in writing and keep an eye on application and reconfirmation dates. A little preparation can make the difference between a welcome saving and an unexpected bill.