SCMA members recently contributed to a four-nations survey, conducted alongside our counterpart organisations in England, Wales and Northern Ireland (Coram Pacey, Coram Pacey Cymru and the Northern Ireland Childminding Association).
The response level from Scotland provides both a very strong sample and indication of the strength of concern amongst our workforce, and the results published today (11 February 2026) are stark and demand attention. Read the full joint press release statement
HERE.
In response to this current situation, Graeme McAlister, the Chief Executive of SCMA, has published a BLOG, which provides further context in relation to childminding in Scotland including Scotland-specific data and results from the survey.
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As a Chief Exec of a national Third Sector organisation, it isn’t often that my flabber is gasted, but it is now.
Having worked to create a high level of positive joined-up working nationally and locally in Scotland to support children, families and communities by maintaining and creating much-needed childcare places, this could be undermined at a single stroke by a recently announced and unexpected intended HMRC change in taxation for childminders; a development which has arisen without consultation or connectivity with this joined-up activity and is linked to a policy development in England which has no legal or regulatory standing in Scotland (or Wales and Northern Ireland).
New survey data has shown that if implemented, instead of boosting revenue for the Treasury, this could cause over 1 in 2 childminders in Scotland to leave the workforce, 1 in 3 to take on fewer children and 1 in 4 to withdraw places … and take thousands of childminding spaces for children and families out of the system – worsening the acute shortages of childcare which already exist in many communities. However, it is important to stress that the taxation change has not yet been implemented and that this situation could be avoided if HMRC actively listens to the concerns of childminding businesses around the UK, increasing cross-party political concern and the Scottish Government which confirmed earlier this week that it has also written at Cabinet and Ministerial level to the Treasury, pauses and re-thinks the intended changes for childminders.
Confused? Allow me to explain …
Background
The childminding workforce in Scotland had been declining before the pandemic, and this decline was accelerated further by it. If you wonder why this is important, in addition to providing high-quality nurture and learning for children, childminding is important to economic and community development and plays a vital role in supporting parental employment by creating much-needed childcare spaces to enable parents in our communities (urban, rural and remote) to work, stay in work or seek work and, in turn, contribute to a reduction in child poverty.
Spanning pre-school and school-age childcare (from 0-12 years) and children with additional support needs up to 16, childminding is also a valued form of family support and a community asset in many areas where larger staffed childcare settings may not be financially sustainable. Recognising our own responsibilities as a professional membership organisation for childminders in Scotland, the Scottish Childminding Association (SCMA) launched an
ambitious strategy in May 2021, mid-pandemic, when few were looking forward, to drive recovery, address and reverse this decline. We also
projected in 2022 that the 34% decline in the childminding workforce which had been experienced since 2016 (with the loss of 1,926 childminding businesses and 11,363 childminding places for families) could almost double by 2026 without intervention.
This has led to much positive joined-up work at a national and local level in Scotland involving SCMA, local authorities, regional enterprise and national development agencies, regulatory bodies and the Scottish Government which created small, but very encouraging and repeated signs of recovery. These are now being driven at pace and scale by the
Programme for Scotland’s Childminding Future – a three-year national programme on childminder recruitment and retention, predominantly funded by the Scottish Government and delivered by SCMA, which is currently in its second year and in which 30 out of 32 (or 94% of) local authorities in Scotland are partnering with SCMA on recruitment, with retention pilots underway in 23 local authority areas. In December
we reported that over 3,600 enquiries about becoming a childminder had been received in response to our marketing campaign; 450 candidates had already enrolled on our Induction Support Programme; 217 candidates had applied to the Care Inspectorate to register as a new childminder; and 89 had completed registration as childminders. Since then, these numbers have accelerated with a significant number more recorded at all stages. While this might sound very positive and has taken significant effort to achieve, this work is at a critical stage and could be undermined at a single stroke by this recently announced intended change in taxation for childminders by HMRC.
Intended HMRC Taxation Change for Childminders
HMRC will be implementing the first phase of Making Tax Digital, the new online system for making quarterly tax returns, in April 2026. As self-employed small business owners, all childminders will be required to use this. This will present significant change and involve additional time for childminders to familiarise themselves with it. Given that it has been established that the main reason childminders have left our workforce has been the significant increase in paperwork, bureaucracy and duplicative quality assurance which had been experienced during the expansion of Early Learning and Childcare and which had affected childminders, as mainly sole workers, disproportionately, SCMA has been keen to positively influence the implementation of Making Tax Digital and to minimise the impact on childminders. We have participated constructively in a range of activity over the last couple of years including participating in trade fora, attending meetings with HMRC and others, hosting webinars, commenting on supporting material and considering what resources we may be able to develop to support members.
Wear and Tear Allowance
To compound matters, HMRC suddenly announced just before Christmas that they would also be changing childminders’ ‘wear and tear’ allowance when implementing Making Tax Digital. An agreement with HMRC (since 1986) has recognised the unique and specific nature of childminding and the high level of ‘wear and tear’ experienced in childminding. This is due to childminding settings being based in homes, the number and ages of children cared for and childminding settings often also operating across different rooms, family areas of the house and gardens (unlike other forms of home-based businesses which have a more restricted footprint, footfall and less wear and tear). This has allowed childminders to declare 10% of their income as tax-free due to ‘wear and tear’ and this informed, childminding-specific approach has worked well. However, it has recently been decided that childminders using Making Tax Digital will no longer be eligible for this allowance and must instead directly claim for all individual items which may qualify for ‘wear and tear’ against criteria instead of accessing this simple allowance - directly increasing the administrative burden on childminders, while potentially reducing the financial benefit to be derived.
While Making Tax Digital will be implemented on a phased basis and only a small number of childminders will be affected in the first year (those with qualifying incomes of £50,000+), the intention is to apply this approach for most childminders on a phased basis in subsequent years, with those on £30,000+ affected in 2027 and £20,000+ in 2028. Currently, it is not anticipated that those earning less than £20,000 will be required to use Making Tax Digital. However, childminders have already been asking SCMA if they should consider reducing their business model and income to avoid different thresholds or having to use the new system. This could have the unintended consequence of driving down businesses and further reducing capacity in the form of much-needed childminding places for children and families and some childminding businesses could render themselves financially unsustainable.
Of additional concern, SCMA has been advised by HMRC officials that the changes to ‘wear and tear’ have been driven not by Making Tax Digital, but by the Department of Education’s (in England) introduction of a new category of childminder on non-domestic premises - an England-only policy initiative with very low uptake and this category doesn’t exist legally or in regulation in Scotland or other parts of the UK; in parallel we understand that while HMRC consulted the Department of Education about this change on ‘wear and tear’, there was no consultation on this change in Scotland or Northern Ireland. While taxation is clearly a reserved matter we believe it would be reasonable to expect consultation where this could impact directly on a devolved matter; similarly, devolution has been established for over 25 years and where a significant change is being proposed to a long-standing agreement it would also be reasonable to expect meaningful consultation on this matter from a UK Department with all involved parties (devolved administrations and childminding representative bodies) in all parts of the UK. Sadly, this did not occur. Neither does there appear to have been any attempt to contribute to the positive joint working underway.
Increasing Cross-Party Political and Government Support for Childminders’ Concerns
SCMA has engaged constructively with HMRC about this individually and collectively with our counterpart organisations around the UK; also recognising that this involves a reserved matter (taxation) impacting upon a devolved matter (childcare), we have engaged on a cross-party basis with Scottish MPs at Westminster and MSPs in Scotland in addition to taking this up with the Scottish Government to request parliamentary scrutiny of this development.
This led to our concerns, and those of our members, being raised with the First Minister during
First Minister’s Questions in the Scottish Parliament on 22 January 2026 by the Scottish Conservative Spokesperson on Children and Young People; in parallel we understand that her counterpart in the Scottish Liberal Democrats has written to the Scottish Government and in Scottish Labour has contacted the Secretary of State for Scotland regarding this. SCMA has supported members to express their concerns to their local MPs and MSPs and understand that many emails and letters have been sent across the country and members have also been sharing back responses received and copies of letters sent to the Treasury and HMRC by their local politicians.
Most recently, the
Scottish Government has replied to SCMA on 9 February 2026, and confirmed that it has now written formally to the Treasury (joint letter from Shona Robison MSP, Cabinet Secretary for Finance and Local Government, and Natalie Don-Innes MSP, Minister for Children, Young People and The Promise) to also express concern about the potential impact of this change and has supported our and our members’ call for any changes to the ‘wear and tear’ allowance to be paused.
New Survey Data
To further inform this matter, SCMA has a contributed to a four nations survey of childminders conducted with our counterpart organisations in England, Wales and Northern Ireland (Coram Pacey, Coram Pacey Cymru and the Northern Ireland Childminding Association). The survey results are stark and demand attention.
A total of 4,850 childminders/individual childminding businesses responded from around the UK, with a little over 24% of the responses (1,167) from Scotland.
The response level from Scotland was proportionately the highest from around the UK, also representing 50% of SCMA members and 42% of the childminding workforce in Scotland – providing both a very strong sample and indication of the strength of concern in Scotland.
Results were broadly consistent across the UK and the main findings in Scotland found that:
95% (n=955) of childminders in Scotland who responded currently claim the ‘wear and tear’ allowance.
If the intended changes to the ‘wear and tear’ allowance are implemented:
- over 1 in 2 (52%) childminders in Scotland who responded will leave the workforce, 1 in 3 (32%) will take on fewer children and 1 in 4 (23%) will withdraw places: this would significantly reduce capacity when we already have acute shortages of childcare in most areas of Scotland and are working to increase capacity. There is an average of 6.9 children per childminding setting in Scotland (ELC Statistics 2024, Care Inspectorate, September 2025). If just focussing on the 52% (n=517) of childminders who said they would leave this could mean 3567 childminding places lost for children and families; and if extrapolating this percentage to the full childminding workforce in Scotland the loss of 9833 childminding spaces for children and families.
- 96% (n=960) of childminders in Scotland who responded believe changes to wear and tear will increase the administrative burden on them (73% (n=734) significantly).
- 79% (807) of childminders in Scotland who responded believe they will be worse off, with a further 8% (n=77) believing this could vary from year to year; and
- 93% (n=928) would support a delay in any changes to wear and tear.
This latest data is stark, deeply worrying and only adds to the concerns already shared with HMRC and others about the significant harm which this rushed measure could cause.
The intended changes to the ‘wear and tear’ allowance must be urgently paused and the 10% of income tax-free element/allowance for ‘wear and tear’ retained for all childminders; if this is not possible then the implementation of Making Tax Digital for childminders should be delayed.