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Childcare vouchers firm won’t refund £2,800 accrued since pandemic struck

<span>One reader said KiddiVouchers told her that her change of circumstances did ‘not meet the exceptional or unforeseen threshold for a refund’.</span><span>Photograph: Dominic Lipinski/PA</span>
One reader said KiddiVouchers told her that her change of circumstances did ‘not meet the exceptional or unforeseen threshold for a refund’.Photograph: Dominic Lipinski/PA

During the pandemic I did not reduce my monthly payments for childcare vouchers. As a result I have nearly £2,800 in my tax-free childcare account. I now work remotely and don’t need them but have been told I can’t get a refund.

I was paying the maximum £243 a month via salary sacrifice into my KiddiVouchers account. This worked until Covid hit but my employer has switched to permanent home working so I no longer need wraparound childcare.

I explained my change in circumstances to
[the scheme provider] and requested they refund my employer so it could be repaid (after tax and national insurance) to me. My employer is happy to do this.

However, KiddiVouchers has refused because it “does not meet the exceptional or unforeseen threshold for a refund”. I can’t believe that the pandemic is not considered “exceptional or unforeseen”.

There are some holiday clubs and courses that accept vouchers, but given we could really do with the money, it doesn’t make sense to be considering expensive residential holiday clubs to use them up.

DO, East Lothian

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Related: All systems are no go when it comes to getting my Allsave childcare vouchers

Childcare voucher schemes such as this – which closed to new entrants in 2018 making way for the tax-free childcare scheme – are a staff benefit offered by many companies, including the Guardian.

The employer pays for the vouchers out of your gross wages so you don’t pay tax and national insurance (NI) on the amount, saving a working parent roughly £1,000 a year.

Numerous companies run these schemes and, based on parenting forums, some are more willing than others to process a refund. However, the terms and conditions of KiddiVouchers, which is run by Wider Plan, state vouchers are non-refundable and requests are only granted in “unforeseen and exceptional circumstances preventing the future use of the vouchers”.

After being refused a refund, NM, a company secretary and trained solicitor with £4,200 in her account, pursued Wider Plan via the small claims process. The claim, which was heard in March, was dismissed, with the judge stating it was a “risk” to run up such a big balance but also that the company must exercise its discretion reasonably.

It took a year to reach court and during mediation NM rejected a 50% refund.

However, she believes the decision has provided a better base for other claims to be brought against Wider Plan and if you wish to consider this route you can request a transcript of the judgment to form your own conclusion.

Wider Plan, which did not respond to a request for comment on your case, reminds you that the vouchers are valid until 1 September after your youngest child’s 15th birthday (at present your daughters are 11 and 12) and can be spent on clubs and activities, with PGL adventure holidays a popular choice.

They can also pay for tuition or online courses. You would be taxed on any refund so why not make the best of the help or experiences these vouchers could buy your children?

We welcome letters but cannot answer individually. Email us at consumer.champions@theguardian.com or write to Consumer Champions, Money, the Guardian, 90 York Way, London N1 9GU. Please include a daytime phone number. Submission and publication of all letters is subject to our terms and conditions.