Parents offered compensation over Tax-Free Childcare

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Thousands of parents who missed out on signing up to the Tax-Free Childcare scheme due to technical issues may be able to receive compensation from the Government.

Since it went live in April, the Childcare Service website run by HMRC has had a number of technical difficulties which has meant that many parents have not been able to register for Tax-Free Childcare and 30 hours.

In order to get the 30 funded hours childcare in September, parents need to receive a code by the 31st August and give it to their childcare provider.

Purnima Tanuku, chief executive of the National Day Nurseries Association, said: “We welcome this move to offer compensation and feel that it’s the right thing to do.  No-one should lose out on their entitlement. We also add that we urge the Government to deal with claims swiftly, as well as ensuring that the issues are resolved and the system works for everyone as we count down to full roll-out of 30 hours in September.”

Nicky Morgan, chair of the Treasury Committee, wrote to HMRC last week demanding answers about the poor performance of the website.

The letter was written because so many parents had difficulties – including an inability to verify parents’ details or their child’s details, as well as parents being locked out of their accounts.

Ms Morgan said she had written to chief executive and permanent secretary John Thompson at HMRC to ask for further information, such as the duration of outages, the amount of complaints, and the number of people who have been unable to access their Childcare Service account.

Tracy Brabin, shadow early years minister, also wrote to Mr Thompson with the concerns she had about the registration for the 30 hours. She wrote: “I have been approached by both parents and settings to complain about faults with the online registration system and helpline. Nurseries tell me that if parents don’t register in time that their funding will be delayed.”

The MoneySavingExpert website made a Freedom of Information request and found that nearly 947 official complaints had been made about the website between its launch on the 21st April and the 18th July.

New guidance published on the gov.uk website under the heading ‘Childcare Service Compensation’ states that: “If you’ve been unable to access Tax-Free Childcare through your childcare account for technical reasons, you may be able to claim compensation.

“If you’ve been affected by technical issues, you may be able to get the government top-up as a one-off payment. We’ll also consider refunding any reasonable costs directly caused by the service not working as it should, mistakes or unreasonable delays.”

It says that parents may be eligible for these payments if they have:

  • been unable to complete their application for Tax-Free Childcare
  • been unable to access their childcare account
  • not received a decision about whether they are eligible, without explanation, for more than 20 days.

For parents to make a claim, they must send HMRC a brief description of the issues they are experiencing. They must have copies of receipts for payments to childcare providers, their full name, their home address, National Insurance number, bank name, account number and sort code.

According to HMRC, more than 180,000 parents have signed up successfully and around 2,000 parents are signing up successfully daily.

HMRC has said that parents who have already applied for 30 hours should be able to get their code by signing into their account and selecting ‘30 hours free childcare’. Their code should start with 500.

HMRC has advised parents who have not been able to complete their application for technical reasons to phone them on 0300 123 4097.

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