Commentary on Sections Childcare Accounts Section 19: Payments into childcare accounts
95.Section 19 deals with payments that can be made into a childcare account.
96.An account-holder or any other person may make qualifying payments into a childcare account at any time during an entitlement period, provided the account-holder has made a valid declaration of eligibility for that entitlement period and the child is a qualifying child when the payment is made. Multiple qualifying payments may be made into a childcare account in an entitlement period. An account provider must notify HMRC of any qualifying payments made into a childcare account to enable HMRC to make the associated top-up payment.
97.The maximum value of qualifying payments which can be made into a childcare account in an entitlement period is £2,000, although this can be adjusted in regulations. Regulations can also adjust the maximum qualifying payment in particular cases. For example, regulations may provide for the maximum to be adjusted proportionately for entitlement periods that are not the standard 3 months.
98.There are two types of payments into childcare accounts that are not qualifying payments. The first is a top-up payment, which means that it will not itself attract a top-up payment when it is paid into a childcare account. The second type of payment is a repayment made into the childcare account. This deals with cases where an account-holder overpays their childcare provider from their childcare account, and the childcare provider returns the amount overpaid to the childcare account. Because the repayment will already include a top-up element, it should not attract a further top-up payment. However, where an amount that has previously been withdrawn by the account-holder is re-deposited into the account, the corresponding top-up element of the withdrawal will have been returned to HMRC under section 22, so that payment will not include a top-up element and should, therefore, qualify for a top-up payment.