Can You Claim Childcare Costs on Self Assessment
Many self-employed parents wonder whether childcare costs are deductible on their Self Assessment return. Unfortunately, the answer is no — childcare is a personal expense, not a business expense, and cannot be claimed against your self-employment profits.
Why Childcare Is Not Deductible
HMRC considers childcare to be a personal cost of the parent, not a cost of the business. Even though you need childcare in order to work, the expense is not "wholly and exclusively" for business purposes — it is for looking after your child.
What You Can Do Instead
Tax-Free Childcare: The government scheme provides up to £2,000 per year per child (or £4,000 for disabled children). For every £8 you pay in, the government adds £2. Self-employed parents are eligible if they each earn at least £2,167 per quarter (equivalent to working 16 hours at the National Living Wage).
30 Hours Free Childcare: If you are self-employed and earn at least £2,167 per quarter, you may be eligible for 30 hours of free childcare per week for children aged 3 and 4.
Childcare vouchers: If you are in an existing scheme (closed to new entrants), you can continue to use it.
Working From Home Benefit
While childcare itself is not deductible, working from home to reduce childcare costs means you can claim home office expenses. Accounted helps you calculate and claim your working-from-home deduction.
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Tax & Compliance Specialists
Our tax specialists have decades of combined experience in UK sole trader and small business taxation, MTD compliance, and HMRC submissions. All content is reviewed against current HMRC guidance before publication and updated quarterly to reflect legislative changes.
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