Income Tax (Earnings and Pensions) Act 2003 section 318AZA

Meaning of "eligible employee"

Section 318AZA defines what makes an employee "eligible" for the employer-provided childcare exemption, requiring them to meet three conditions relating to their participation in the scheme and their choice not to switch to a tax-free childcare account.

• An employee must satisfy all three conditions (A, B and C) to be eligible for the limited childcare exemption under section 318A.
• Condition B requires that, in any rolling 52-week period ending on or after the relevant day set by the Treasury, the employee must have received qualifying employer-provided childcare in at least one tax week.
• Condition C requires that the employee has not given their employer a written "childcare account notice" opting out of the scheme in order to open (or allow a partner to open) a tax-free childcare account under the Childcare Payments Act 2014.
• A "qualifying week" is one in which employer-provided childcare met all the conditions (A to D) set out in section 318A, and the definitions of "care" and "child" are found in section 318B.