What do UK employers typically spend on childcare benefits?

UK employers that publish their policies typically fund between one day and around 20 sessions of back-up care per employee per year. Priced at current UK childcare rates, that's roughly £120 to £2,500 a year per employee who uses their full allowance. There is no official UK average for employer childcare spend, and most employers don't offer back-up or emergency childcare at all.

How many UK employers offer back-up childcare?

The CIPD's Reward Management Survey, published in April 2022, found that 23% of UK employers offered support for emergency childcare. Provision was much higher among very large organisations, half of which offered it to all staff. More recent CIPD data doesn't break childcare benefits out separately.

What is a typical back-up care allowance?

Published allowances at large UK employers range from one free day a year at Imperial College London to up to 20 funded sessions a year at PwC UK. Deloitte UK offers five fully subsidised and five part-subsidised sessions, and Adobe UK offers up to 15 days. These are large employers, so treat them as the upper end of the market rather than the norm.

Can employers still offer childcare vouchers?

Not to new joiners. Childcare voucher and directly contracted childcare schemes closed to new applicants in October 2018. Employees who joined before then can keep using them while they stay with the same employer and it continues to run the scheme.

Is an employer-funded childcare allowance a taxable benefit?

It depends on how the benefit is structured, and the rules are set by HMRC. Some employers publish that their back-up care is processed through payroll as a taxable benefit. Speak to your payroll team or a tax adviser before setting up a scheme.