Many employees enjoy tax savings when they use pre-tax earnings to purchase childcare vouchers from their employer. However, Gordon Brown announced last week that, from April 2011, employees who want to join an employer-supported voucher scheme will not get the current tax exemptions and, from April 2015, voucher exemptions will be withdrawn completely.

It is proposed that the savings made from scrapping tax relief on childcare vouchers will be used to provide free childcare for children from low or modest income families.