§ Sir Ian GilmourTo ask the Chancellor of the Exchequer if he will publish the information he has for each of the member states of the European Community, and for Norway, Sweden and Finland, on the tax treatment of work-related child care costs.
§ Mr. Norman LamontThe latest available information is given in the table. To make a valid comparison between countries it would be necessary to take into account the standard tax allowances and tax reliefs given to parents and the level of child benefits given through the social security system.
All amounts have been converted to sterling using the latest available purchasing power parities.
695WCountry and treatment of work-related child care expenses
Belgium
Up to 80 per cent. of expenses are deductible in respect of children under three years old, subject to a maximum of £4.94 per child per day of care.
Denmark
No tax relief is given.
France
There is a tax reduction equal to 25 per cent. of expenses limited to £1,293 per year (1990 figure) for each child under seven years old. The tax reduction is available to single, widowed, divorced or separated taxpayers who work outside the home and to a couple where each spouse either works or attends a full-time course of higher education.
Germany
Expenses are deductible up to £1,064 per year for the first child and £532 for each additional child. A minimum lump-sum deduction of £128 (without proof of expenditure) is allowed. The deductions apply to single parents and couples if one spouse (or partner) is sick or disabled.
Greece
Taxpayers are exempt from income tax on 50 per cent. of the annual cost of sending a child to a nursery or kindergarten, up to a maximum of £549 per child per year.
Ireland
No tax relief is given.
Italy
No tax relief is given.
Luxembourg
Childcare expenses (apparently whether work-related or not) are deductible for single persons, and persons with a child under 14 years old in the household. The total deduction for childcare expenses and domestic help may not exceed £270 per year.
Netherlands
Expenses are deductible, but part of the costs (which must be proved) must be borne by the parent(s). The amount to be borne by the parent(s) ranges from 10 pence per hour for those with an annual combined income of less than £9,091 to £1.18 per hour for those with an annual combined income of over £29,091. If the expenses relate to more than one child, the amount to be borne by the parent(s) is increased by 10 pence per hour for each additional child.
Portugal
A deduction is allowed for educational expenses (including creches and nurseries, and apparently whether work-related or not) to a maximum of £700 (for single taxpayers) and £1,400 (married). These maximum amounts are cumulative with deductions allowed for other expenses eg life insurance, medical expenses.
Spain
With effect from 1 January 1992 a deduction is allowed for 15 per cent. of expenses incurred to a maximum of £137 in respect of each child under three years old if the parents work away from home and the taxpayer's net income does not exceed £10,966.
United Kingdom
Employees are exempt from income tax on the benefit of a workplace nursery place provided by their employer. No other tax relief is given.
Finland
No tax relief is given.
Norway
No tax relief is given.
Sweden
No tax relief is given.