In February, the government’s tax-free childcare account system had an issue which meant payments into some accounts were duplicated. In my case, a payment of £779 into my daughter’s account was credited five times. The affected accounts were frozen while the extra payments were reclaimed. Five months on, my daughter’s account remains frozen, and I am unable to get the funds to pay her nursery bills. I also can’t make any new payments into the account in order to benefit from the tax-free allowance. Each time I phone, I’m told they can give no indication of when this will be resolved.
MM, Newbury
Tax-free childcare is a government scheme to subsidise the cost of childcare. For every £8 paid in by a parent, a £2 top-up is provided by the state. More than 8,000 families were locked out of their accounts in February when their deposits were erroneously multiplied by the banking provider used by NS&I, which administers the scheme, and they were collectively paid £18.6m in top-ups instead of the £3.1m due. Some nearly lost their nursery places when they were unable to pay the fees.
Each account had to be corrected manually and, when I contacted HM Revenue & Customs, it told me that about 30 remain frozen. It claims customers were regularly updated, but you say you have had to chase fruitlessly for news. Your account was unstuck within two days of my intervention, and I’ve been assured the remaining 30 are now also miraculously restored.
HMRC says it would be sending letters apologising for the inconvenience – a gesture that appears not to have occurred to it before – and an agent called you to talk through the fiasco. You will soon be receiving the £320 due in top-ups.
Anyone else affected can submit a form to apply for retrospective credits and associated costs.
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