Up to 99,000 children are missing out on childcare assistance as working parents face exclusion due to a strict earnings threshold. Eligible working parents have the opportunity to receive up to 30 hours of free childcare each week. However, if a parent’s adjusted net income exceeds £100,000, the family may not qualify for the full 30-hour benefit.
Recent estimates from the Department for Education (DfE) reveal that between 50,500 and 99,000 children were impacted by the earnings limit in 2025/26, resulting in approximately £874 million in inaccessible funded childcare support. This significant increase from previous years indicates a growing number of families being affected by the threshold, which was originally set at £100,000 and has not kept up with inflation.
Financial planner Ian Futcher from Quilter emphasized that even a slight increase in income could lead to families losing access to valuable childcare support. To maintain eligibility for free childcare hours, families can consider options like increasing pension contributions or utilizing salary sacrifice to lower their adjusted net income.
Futcher highlighted the importance of understanding these thresholds to secure access to childcare assistance and other tax benefits. The Mirror has reached out to the DfE for further comments on this matter.
