A Workplace Nursery Scheme allows an employer to help employees with the cost of nursery childcare by providing nursery places through Salary Sacrifice. Where structured and operated correctly, the full cost of the childcare can be exempt from Income Tax and National Insurance. To see what kind of savings your business can make, click here and find out in just 2 clicks.

Unlike voucher-style arrangements, there is no weekly or monthly cap on the value of the childcare or the savings that can be made

Employer involvement is limited but deliberate. It includes:

• Committing to a fixed monthly financial contribution for the agreed contract term (ITEPA 2003)
• Participating (through their employee who has a child at the nursery and acts as the company's agent) in a small number of structured meetings that focus on:
  • How management of the nursery operates
  • Staffing levels and staff training
  • How employer-provided funding is used
  • Any other material matters

Employers are not expected to manage staff and are absolutely not involved in day-to-day running of the nursery but will act as a support, and provide at least partial management and be a meaningful financial contributor to the nursery.

The management meetings form part of the evidence that the employer is genuinely involved in the scheme. If they do not take place or are not conducted properly, the Income Tax and National Insurance savings obtained through the scheme would be due to HMRC.

Feel The Benefit actively schedules, facilitates, and records meetings to ensure and be able to demonstrate the meetings have taken place, and have materially contributed to the finances and management of the nursery.

The employer commits to a fixed monthly contribution to the nursery, a minimum of £100 per participating employee per month.

In the majority of cases this cost is more than offset by employer National Insurance savings arising from salary adjustments, making the scheme cost-neutral or more typically, a significant net cost saving to the employer.

Feel The Benefit manages the setup process end to end. This includes documentation, employee onboarding, nursery engagement, and payroll coordination.

From the employer's perspective, setup is typically limited to approving participation and implementing agreed payroll adjustments. Employees can apply online through our website for which we provide secure access.

Feel The Benefit supports multiple payroll approaches, including salary sacrifice, salary addition, or net pay arrangements.

Employers must ensure that no employee's pay falls below National Minimum or Living Wage thresholds. Where salary sacrifice is not appropriate, alternative structures can be used so the scheme remains open to all eligible employees.

The majority of these workplace nursery places are paid for through salary sacrifice which works in the same way as other salary sacrifice schemes in terms of deductions being applied before Income Tax and National Insurance is deducted.

While the scheme supports parents of nursery-age children, its impact is often wider. Childcare costs are a significant driver of workforce attrition, particularly among parents who may otherwise leave employment to offset the costs of childcare.

Retaining experienced staff reduces recruitment costs and disruption across teams. It is statistically 7 times more likely that the female parent who will give up work to provide childcare, as the gender pay gap would typically dictate this is the most financially prudent move, and so this benefit helps retain female talent in the workplace.

No. The scheme is open to all eligible parents. While childcare costs disproportionately affect women due to existing pay gaps and caring patterns, the benefit is equally available to fathers and other eligible caregivers.

Tax-Free Childcare is a government scheme with capped support. A Workplace Nursery Scheme can deliver greater savings for many families, particularly where nursery fees are high.

Employees should consider their own circumstances, and Feel The Benefit provides tools to help illustrate potential differences. Employer savings can be calculated using our employer savings calculator. Employee savings can be calculated here.

Feel The Benefit acts as the scheme agent. This includes:

• Structuring the arrangements
• Coordinating employers and nurseries
• Facilitating, directing and recording the required meetings
• Maintaining records
• Taking and making all payments
• Providing a secure online portal for documentation and transparency

The scheme is particularly well suited to employers with one or more employees using nursery childcare and a desire to retain skilled staff.

Feel The Benefit works with employers to determine whether the scheme is appropriate based on workforce profile and objectives.

Yes, by playing a part in helping manage and financially support one or more nurseries helps invigorate local businesses, allowing them to potentially finance more free childcare places and more free childcare hours to the benefit of the wider community.

You are genuinely helping finance nurseries, who, according to polling by the EY Alliance, 10% of which are at risk of closure in the next 2 years due to under-funding and more than a quarter pausing hiring due to financial pressure.

The Workplace Nursery Scheme lets you pay your nursery fees from your salary before Income Tax and National Insurance are deducted — in much the same way as a Cycle to Work scheme, but for nursery childcare.

Because the deduction happens before tax, you keep the money that would otherwise have gone straight to HMRC. For many families this means a saving of around 33% of what you currently pay for nursery.

Tax-Free Childcare is a government scheme that gives you 20p for every 80p you pay in — up to a cap. The Workplace Nursery Scheme works differently: your entire nursery fee is deducted before tax, with no monthly cap on the amount.

For many families — particularly those with higher nursery fees or a higher rate taxpayer in the household — the Workplace Nursery Scheme can deliver a significantly larger saving. Our calculator can show you a side-by-side comparison for your situation.

Here is how it works:

1. Register your interest here — it only takes a few minutes.
2. We use your details to contact your employer and explain the scheme to them. It also helps if you mention it to them yourself — employers are often much quicker to act when an employee brings it to them directly.
3. If your employer agrees to participate, we put the scheme in place and you can start saving.

We handle the paperwork, the nursery, and the payroll coordination — you just need to get the ball rolling.

Most haven't — and that's absolutely fine. We have a dedicated FAQ section for employers explaining exactly how the scheme works and what it involves.

In many cases the scheme saves the employer money too through reduced Employer National Insurance contributions, so they often welcome it once they understand it. Register your interest and we will do the legwork.

Your employer decides whether the scheme is offered. You can register your interest with us, but we would also encourage you to speak to your employer directly, so that they expect to hear from us as part of the process.

You can use almost any registered nursery. There is no approved list or pre-registration required — we will work with your nursery as part of setting up the scheme.

The only exception is Bright Horizons. Bright Horizons operate their own equivalent scheme for parents of children in their nurseries. Because they run this independently, they do not work with third-party providers like us.

If your child attends a Bright Horizons nursery, we would encourage you to use their scheme — the savings available to you should be very similar, and ultimately we want every parent to be able to Feel The Benefit, whether that is through us or through Bright Horizons.

Most Ofsted-registered nurseries can take part, provided they meet required standards and agree to the partnership arrangements. Feel The Benefit will contact your nursery if they are not already offering the scheme and explain what is involved before any arrangement can be put in place.

Yes. A saving of around 33% of your nursery fees adds up quickly. If you are paying £1,200 a month in nursery fees, that is a potential saving of around £400 a month — or nearly £4,800 a year — staying in your pocket rather than going to HMRC.

Use our savings calculator to see the real numbers for your household.

There is a legal requirement that salary sacrifice cannot take your pay below the National Minimum or Living Wage. Your employer will make provision for this — it simply means the sacrifice amount is adjusted so your take-home pay stays above the threshold.

If you are close to minimum wage you will typically save a smaller amount, because you pay less Income Tax and National Insurance to begin with. But there is usually still a saving available, and it is always worth using the calculator to find out exactly where you stand.

The HMRC legislation that provides the tax relief concession for this scheme requires that the employer must be at least partly responsible for managing and financing the nursery provision — not just paying for it. The structured meetings are the practical way in which your employer provides that genuine involvement.

As the parent, you act as the employer's representative at these meetings. You are specifically not required to manage the nursery day-to-day, but you are required to provide management input and guidance to the nursery, which can be around key issues such as staffing levels, staff qualifications, larger projects, ambitions, strategic changes at the nursery, you must attend on behalf of your employer and ensure your full and genuine participation in the meetings. You will also be responsible for agreeing how your employer's financial nursery contribution is spent by the nursery.

Meetings are held periodically throughout the year. The exact frequency is agreed as part of setting up your scheme. Feel The Benefit schedules and coordinates them — you will not need to chase or organise anything yourself.

No detailed preparation is needed. Feel The Benefit will provide app participants with an agenda in advance. You must attend, engage, and fulfill your obligations of contrubting to the management of the nursery in this meeting, atferwards you will be sent confirmation of the discussions that took place, ensuring that the required topics have been covered and the notes accurately record what was said and agreed. The meeting record is maintained by Feel The Benefit and will be accessible to all meetings participants via their respective online accounts.

Changes in childcare hours are expected. Fees can usually be revised to reflect changes in usage, subject to your employer's agreement. Adjustments are managed through the scheme administrator.

If you leave your employer, you cannot continue to benefit from the scheme or its savings. You are not personally liable for remaining nursery fees under the scheme once employment ends, as the arrangement must be funded through your employer.

Questions about eligibility or payroll should be directed to your employer. Feel The Benefit can help explain how the scheme works and provide illustrative calculations, but decisions to proceed sit with your employer.

You can contact us here for general scheme queries.

A Workplace Nursery Scheme is an arrangement where an employer partners directly with a nursery to support employees with the cost of childcare. The employer makes a financial contribution to the nursery and contributes to the nursery management. This creates a genuine partnership between the employer and the nursery, rather than a simple fee-payment arrangement.

In addition to normal nursery fees, the employer provides additional funding to the nursery and participates in structured management discussions. This funding is not linked to occupancy or attendance levels and is intended to support the nursery beyond standard fee income.

All payments are made so that cleared funds are in the nursery's bank account before the 1st of the month in which the childcare is delivered. Payments cover the full month of care in advance. Funds are only ever delayed if an employer withholds payment.

Yes. Employer funding can either be spent as it is received or ringfenced for larger projects, such as capital improvements, facilities upgrades, staff training programmes, or other agreed investments.

Evidence is required only for the additional employer funding, not for normal nursery fees. Acceptable evidence includes receipts, invoices, PDFs, emails, photographs, or other documentation that shows how the agreed funding has been used.

A small number of structured meetings are required during the contract. These meetings are facilitated by Feel The Benefit Ltd, recorded, documented and the details are shared with all relevant parties. The purpose is to discuss management matters and how employer funding can best support the nursery.

No. Employers do not run the nursery and are not involved in daily operations, admissions decisions, curriculum delivery, or routine management. Employer involvement is focused on strategic and management-level matters rather than operational control.

Nurseries must be Ofsted registered and meet or exceed expected standards. Nurseries rated as requires improvement may be considered on a case-by-case basis.

Yes. Participation is based on agreement between the nursery, employer, and Feel The Benefit. Any decision to end participation would be managed carefully to ensure existing commitments are honoured.

Feel The Benefit administers the scheme, coordinates employers and nurseries, facilitates and conducts the meetings, manages documentation, manages the funds and fees, and provides the online portal used to support transparency and record keeping.