Earlier this month, the head of the Northern Ireland Childminders Association, Patricia Lewsley Mooney, told Belfast Live that more than 2,000 families could be impacted by a reduction in the availability of childminders as a result of the changes
An MP has said it is “deeply concerning to see proposals that may inadvertently weaken” childcare provision as she calls for a meeting over childminder tax concerns.
DUP MP Carla Lockhart has written to the Chancellor to request a meeting to discuss the impact of the removal of the ‘wear and tear’ tax-free allowance for childminders who move onto HMRC’s Making Tax Digital system.
Earlier this month, the head of the Northern Ireland Childminders Association, Patricia Lewsley Mooney, told Belfast Live that more than 2,000 families could be impacted by a reduction in the availability of childminders as a result of the changes.
Under the current system, childminders can claim a 10 per cent discount on their tax bill to account for ‘wear and tear’ on their homes caused by operating their businesses.
HMRC have said that those using the new MTD system will be able to see an in-year estimate of how much tax they owe, understand their cash flow better, make more informed financial decisions for their business and reduce the risk of under or overpaying tax and that claiming actual costs may be more beneficial than the flat-rate deduction, ensuring that expenses accurately reflect the valuable work childminders do.
Childminders with a qualifying income of over £50,000 are required to use MTD from April 2026. These childminders, HMRC have said that, like any other business, they can continue to get full tax relief on the business proportion of their expenses when they join MTD, meaning their actual expenses will need to be recorded and deducted.
HMRC said that childminders do not currently get a separate allowance from HMRC, and that administrative changes for childminders were announced at the Budget to record keeping and the way some expenses are calculated for childminders in MTD.
They also said that they are aware that childminders are uncertain about how these changes may affect them and may have seen misleading information online. They confirmed that they are supporting customers with a suite of guidance products, direct communications, webinars, live events and social media activity to help them to prepare. and are using targeted paid-for advertising and making direct contact with MTD customers by writing to them to explain the changes and how to prepare.
Speaking on the issue, Carla Lockhart MP said: “I have written to the Chancellor to seek an urgent meeting with the Treasury following HMRC’s proposal to remove the long-established 10% wear and tear allowance for childminders who are required to move onto Making Tax Digital.
“For almost four decades, this allowance has recognised the unique nature of home-based childcare. Childminders operate from their own homes, using their living rooms, kitchens, gardens, equipment and family spaces to provide professional care. The 10 per cent allowance was designed to reflect the inevitable wear and tear that comes with that responsibility, while also providing a simple and proportionate system for small providers.
“Under these proposals, childminders who fall within the Making Tax Digital threshold would lose access to this straightforward allowance and instead be required to itemise individual expenses. That represents a significant increase in administrative burden for small, often single-person businesses, and creates the risk of reduced financial viability at a time when the sector is already under immense pressure.”
Carla Lockhart said that she is working closely with NICMA, the Childminding Association, and engaging directly with local childminders to ensure that the concerns within the sector are clearly understood by the Government.
“There has been no meaningful consultation in Northern Ireland, despite the fact that our childminding model remains home-based and distinct in important respects,” she said.
“The childminding workforce in Northern Ireland has declined sharply in recent years, with a significant reduction in registered providers and available childcare places. Families are already struggling to access affordable and flexible childcare. Any further policy change that increases costs or bureaucracy risks accelerating that decline and reducing capacity even further.
“Childminders are not simply small businesses; they are a vital pillar of our childcare infrastructure. They provide flexible, community-based care that enables parents to work, supports early years development and underpins our wider economy. At a time when we should be strengthening childcare provision, it is deeply concerning to see proposals that may inadvertently weaken it.
“I have therefore called on the Treasury to pause these changes, to properly assess their impact in Northern Ireland, and to engage directly with representatives of the sector. I will continue to press for a fair and proportionate approach that supports, rather than penalises, those who provide this essential service.”
Earlier this month, a HMRC spokesperson said: “All childminders will still be able to claim for the same categories of expenses as they currently do, including wear and tear. Those in MTD may also be able to claim more than they currently do.”.
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