MagicBooking partners with HMRC to revolutionise Tax-Free Childcare payments for schools and clubs

This integrated TFC payment solution tackles issues of socioeconomic accessibility plus cuts arduous workloads & administrative costs for childcare providers.

LONDON, LONDON, UNITED KINGDOM, February 10, 2025 /EINPresswire.com/ -- MagicBooking Partners with HMRC to Streamline Tax-Free Childcare Payments:

MagicBooking, a UK-based booking, payment, and admin system for schools, clubs, and childcare providers, has partnered with HMRC to offer one of the first fully integrated Tax-Free Childcare (TFC) payment solutions. This innovative feature will drastically reduce administrative burdens, making TFC payments smoother, faster, and more accessible for both parents and providers. The update launches on February 10th, 2025, simplifying the payment journey for families using TFC benefits.

How HMRC TFC Supports Working Families:

Tax-Free Childcare helps working parents with childcare costs. For every £8 a parent deposits into their TFC account, the government contributes £2, up to £2,000 annually per child. For children with disabilities, the maximum contribution increases to £4,000.

Improving Accessibility for Parents and Providers:

HMRC TFC payments have become essential for self-employed, part-time, returning-to-work parents, low-income families, and single-parent households.

For years, MagicBooking has helped providers process TFC payments, but integration with existing booking systems presented challenges. Providers had to manage manual processes for accepting and reconciling TFC payments, adding extra work compared to traditional card or cash payments.

Parents faced confusion during checkout, needing to log into HMRC each time to make a payment. Many found accounts frozen for overdue payments while awaiting reconciliation.

These issues highlighted accessibility challenges, especially for families relying on TFC benefits, creating inequalities in childcare access.

Carine Grascher, CEO of MagicBooking, says, “Childcare should not be gatekept by financial privilege. All schools and clubs should accept every legitimate form of payment without labour-intensive processes. Families should use HMRC TFC payments without disadvantage. That’s why we’ve partnered with HMRC for a smoother, more equitable solution.”

Before the HMRC TFC integration, a 2024 client survey revealed 93% of clients felt MagicBooking improved accessibility for parents.

With instant payment verification, automated reconciliation, and seamless checkout for parents, this partnership with HMRC marks a new era in childcare payment systems. Parents can now make payments instantly via MagicBooking, without logging into HMRC, and providers enjoy automated reconciliation, saving time and reducing errors.

Addressing Industry Challenges:

Amid rising living costs and inflation, parents are looking for ways to afford childcare, while providers seek to support them without sacrificing their livelihoods.

The HMRC TFC programme is a vital lifeline for working families, and MagicBooking’s feature ensures the benefits can be easily accessed without administrative bottlenecks.

“By partnering with HMRC, we’ve dramatically improved the TFC payment process,” says Franck Merlin, CTO of MagicBooking. “Our mission is to simplify childcare for parents and providers, making services more accessible while removing administrative hassle. We’re committed to continuously improving and bringing new solutions to drive efficiency during these challenging times.”

These improvements are crucial as Tax-Free Childcare replaced the childcare voucher and directly contracted childcare programmes, which stopped accepting new applicants in October 2018.

Recent government data shows 545,000 families used TFC for 664,000 children in April 2024. MagicBooking’s integration will reduce frustrations with TFC, creating a smoother experience for both parents and providers, especially during rising costs and financial pressure.
What’s Changing with MagicBooking and HMRC

- Instant TFC payments: Parents can now make payments instantly via MagicBooking, directly verified by HMRC.
- Automated reconciliation: Providers no longer need to manually reconcile payments, saving time and reducing errors.
- Simplified checkout: Parents can view balances, validate TFC codes, and make payments all in one seamless process.

The new HMRC TFC integration will be available as a free feature for schools and clubs using MagicBooking initially, transitioning to a paid add-on after a few months. This gives providers time to evaluate whether the time and cost savings from reduced admin efforts justify the investment.

MagicBooking is confident this streamlined feature will ultimately save providers money and time by reducing manual processes. Providers can continue using the original manual TFC payment system at no charge, allowing them to make an informed decision based on their needs.

Based on a 2024 client survey, MagicBooking saves clients around 8,536 hours and £13,341 in staff time annually. 86% of clients reported increased savings, with the average boosting cash flow by 73%. These savings can be reinvested into childcare services, enabling staff to focus on their core responsibilities. With the new HMRC TFC feature, these savings are projected to grow further.

Contact MagicBooking to find out more.

Why MagicBooking Stands Out:

MagicBooking is one of the first platforms to offer a fully integrated TFC payment solution. While other platforms have supported TFC, they haven’t streamlined the entire process. MagicBooking automates everything, from instant payments to error-free reconciliation, ensuring parents won’t be penalized for delays in processing.

Theo Merlin, COO of MagicBooking, says, “We’re proud to lead the way in simplifying childcare payments. By listening to our clients' needs and proactively addressing these issues, we’ve created a solution that saves time and money while making childcare services more accessible to families who need them most.”

Step into the future of childcare: book a demo with MagicBooking. Or simply visit: www.MagicBooking.co.uk.

Alexandra Parapadakis
MagicBooking
+44 7505988587
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