HMRC has paid out £40,000 in compensation to Tax-Free Childcare parents

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Nearly £40,000 has been paid in Tax-Free Childcare compensation to parents for inconvenience and expenses incurred as a result of the scheme.


Parents have received thousands of pounds in compensation after experiencing technical problems with the website

A further £966,66 has been paid to parents in lieu of Tax-Free Childcare payments to date.

The sums were revealed by the chief secretary to the Treasury Elizabeth Truss in response to a parliamentary question tabled this week by the MP for Bethnal Green and Bow Rushanara Ali about how much compensation the Government has paid out as a result of problems with the HMRC Childcare Service website.

In August, the Government announced that parents who had been unable to access Tax-Free Childcare (TFC) because of technical issues with the Childcare Service website, which parents must use for TFC and the 30 hours, could apply for compensation.

In her response, Ms Truss also said HMRC has received 3,496 complaints from parents experiencing technical issues with the online system, and, as of 19 January, the TFC helpline had received 769,015 calls from parents.

The Pre-School Learning Alliance said the Government needed to ‘step-up’ its efforts to fix the Childcare Service website.

Its chief executive Neil Leitch said, ‘We know that HMRC is working to resolve the long-running problems with the Childcare Service website, but this just isn’t good enough.

‘At the moment, applying for Tax-Free Childcare and the 30 hours via the online system is a complete lottery – while some parents have been able to use the service without issue, others are still facing a range of technical problems often preventing them from being able to do the simplest things, from verifying their details to reconfirming their eligibility to simply logging into their account.

‘Given this system is meant to underpin two of the Government’s flagship childcare policies, clearly more needs to be done to rectify these ongoing problems. This is particularly true of Tax-Free Childcare, given that the childcare voucher scheme is due to close to new entrants in April.

‘At a time when the early years sector is facing such financial difficulties, we can think of a whole number of ways that this £1 million could have been far better spent. We hope the Government will take action on this as a matter of priority, and ensure that the childcare support it has promised to parents is actually accessible.’

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