For every £8 you pay into a Childcare account, the government will pay in £2. It will put in a maximum of £500 every three months for each child - or £1,000 if your child has a disability.
This will operate through an online Childcare account, provided by National Savings & Investments (NS&I) in partnership with HM Revenue and Customs (HMRC), which parents and government can pay money into.
You will pay your childcare costs into this account and the Government will 'top-up' the account with their contribution. Any other person, a grandparent or family member for example, can pay into the account as well.
The money will then be paid directly from this one account to your childcare provider. Normally, you can only pay for childcare that helps you work or stay in work out of the account.