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6th Jul, 2022

Nursery owner brands tax-free childcare system 'a shambles'

A NURSERY owner has branded the government’s tax free childcare system a ‘complete shambles’ and says parents are potentially missing out on thousands of pounds.

Steve Taylor, who owns Winchcombe Farm Day Nursery in Upper Tysoe near Stratford, has been trying to enrol for a system in which parents can claim back money for childcare.

But technical issues with the new system mean that almost six months later, they are still unable to accept payments from parents via the account.

Tax free childcare gives eligible working parents up to £2,000 a year for each child to help with the costs of care.

Government pay £2 for every £8 a parent pays into an online account, and then this is passed electronically into the childcare provider’s online account.

Mr Taylor said: “We have one family at our nursery who are losing out on claiming £160 per month tax free childcare – that’s almost £1000 they could have saved but haven’t because HMRC can’t get their IT to work.

“We’ve spent hours and hours of staff time trying to resolve this issue but are getting nowhere. The other day, we spent half an hour on hold to HMRC just to be told that our issue remains in a long queue with very many other childcare providers who are experiencing the same problem.”

In response to the thousands of parents being plagued by the same issues, HMRC has set up a compensation scheme which will enable payments to be backdated.

But since the tax office was unable to confirm when the technical error would be resolved, Mr Taylor is in contact with Stratford MP, Nadhim Zahawi, to help resolve the issue.

The businessman met Mr Zahawi earlier this year after he launched a campaign in response to fears that the increase of 15 to 30 hours of free childcare, would result in a lack of funding for nurseries across the nation.

Mr Taylor added: “This latest fiasco is shocking but is sadly what we’ve come to expect from the shambolic way the introduction of tax free childcare and 30 hours ‘free’ childcare is being handled.”

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