Almost £1 million had to be manually paid to parents who were unable access their Tax-Free Childcare payments, since the scheme began in April last year.
Due to several glitches with the HM Revenue & Customs (HMRC) website, many parents struggled to access payments or even set up accounts, and were paid £966,666 manually as a result.
This is in addition to the £38,949 compensation paid to parents for the inconvenience and expenses such as telephone calls to the helpline.
The statistics, which cover up until 22 December last year, were revealed by Chief Secretary to the Treasury Liz Truss, in response to a question in Parliament.
Truss also revealed that HMRC had received 3,496 complaints from parents who have experienced technical issues with the childcare service.
What is Tax-Free Childcare?
Under the Tax-Free Childcare scheme, parents and carers in the UK can open a special account to save for childcare costs.
For every 80p you deposit, the state adds 20p. In total the state can add up to £2,000 per child a year (or up to £4,000 if your child has a disability) – so including what you deposit, you can use the scheme to pay for up to £10,000 of childcare per child each year.
It’s worth noting you can only get a maximum top-up of £500 every three months, but the state’s extra 20% is added at the point you put money into your Tax-Free Childcare account, not when you spend it.
So if you have seasonal costs, put money into the account throughout the year, accruing the full top-up as you go, then spend it only when you need to thus avoiding the £500 per three-month limit.
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How to claim if you’ve been unable to access your account
If you have been unable to access Tax-Free Childcare, the easiest way to claim your money or ask for compensation, is to use this link.
You can also call HMRC on 0300 123 4097.
You will need the following to make a claim:
- Home address
- National insurance number
- A brief description of the issues you’ve had
- Bank name, account number and sort code
- Copies of receipts for payments to your childcare provider
What problems has the scheme faced?
Since its launch in April last year, the Tax-Free Childcare scheme has been riddled with a series of problems, mainly affecting its website. A timeline of the key issues can be seen below:
What does HMRC say?
A HMRC spokesman said: “More than 340,000 parents have successfully opened a childcare account, and are benefiting from new forms of Government childcare support, which will cut thousands of pounds off bills for millions of households, supporting parents to return to or remain in work.
“If any parent is having a problem or needs to speak to us, they should call us on 0300 123 4097. HMRC can reimburse parents in lieu of their top-ups to ensure that nobody is left out of pocket.”