We often talk about contractors and freelancers in quite an objective way. But perhaps don’t pay too much attention to what these people do away from their professional lives.

However, whilst we love to talk about it at Larsen Howie, contracting and freelancing is only a way of working. We always encourage people to maintain a healthy work/life balance.

As such, many contractors will also be parents. And if you fall into that bracket, then we have some good news.

Contractor Legal Protection - Just £30

HMRC has announced that all working parents can now receive a tax-free childcare allowance. The allowance is available to all working parents – including contractors – with children under the age of 12.

£500 would be sent out every three months as part of the allowance payments, totalling £2,000 a year.

Earnings limit

Though an earnings limit of £100,000 does exist for the allowance, this will not apply to anybody who has set up their business in the last 12 months. Therefore if you are fairly new to contracting and have only recently set up your personal service company – or your annual earnings total less than £100,000 – you can apply.

Commenting on the allowance’s introduction, Jordan Marshall, IPSE’s policy development manager, described the news as being excellent for the self-employed, and in particular the growing number of self-employed women who continue to be responsible for the majority of domestic childcare in the UK.

In 2013, women reported doing 23 hours of domestic childcare each week, compared to 10 hours for men,” he said. “And as the number of women working for themselves grows (they now make up 43% of the UK’s 1.9 million highly skilled freelancers), balancing running a business and childcare will become a problem for more and more people.”

Contractor Jury Service & ID Theft - Only £20

Marshall admits this is a significant step in the right direction. However, he says more could be done to support parents who work on a self-employed basis.

“The next step now should be to do the same for parental leave pay: giving self-employed mothers and fathers access to maternity and paternity pay and shared parental leave,” he added. “Freelancers and the self-employed contribute an enormous amount to the UK economy. When it comes to starting a family, they should be given as much help and support as their employee counterparts.”

However, as we have reported previously, you must be able to prove your income.