Tax-Free Childcare: Closing an account
A claimant cannot close their tax-free childcare account during an entitlement period for which they have made a declaration.
If a claimant does not wish to continue with TFC or stops meeting the qualifying conditions, they simply do not make a re-confirmation declaration for the next entitlement period but this does not have the effect of closing their childcare account.
HMRC will close a childcare account in the following circumstances:
- Two years have elapsed since the end of the last entitlement period for which there was a valid declaration of eligibility; or
- One year has elapsed since the end of the entitlement period during which the child ceased to be a qualifying child.
At the time a childcare account is closed, any funds left in the account will be removed in the following way:
- The top-up element of the funds left in the account at the time it is closed are repaid to HMRC
- The remainder of the funds are returned to the account holder (if the account holder has died, this part of the funds is returned to their personal representative).
Last reviewed/updated 10 January 2020