Only one in 50 working parents entitled to childcare vouchers has signed up for the tax-saving scheme, according to research.
Voucher provider Childcare Choice found that employees believed it would be too much hassle to get involved.
Childcare vouchers, introduced by the government two years ago, allow parents of pre-school children to be paid in tax-free tokens up to £55 per week.
With national insurance exemptions and reductions, employees can save up to £1,195 each year, while employers can save up to £373 for each employee signed up.
However, a quarter of the 1,189 working parents interviewed for the Childcare Choice research believed they would save less than £500 per year. Many said it would not be worth the time needed to sign up.
Iain McMath, managing director of Childcare Choice, said: “It takes just 15 minutes to apply for childcare vouchers online – time well spent when you could be saving a significant amount of money.”
The Campaign for Care Vouchers coalition wants the government to introduce a similar scheme for employees with caring responsibilities. It published research earlier this month showing more than £80m worth of services to help carers back into employment could be generated by just £37m of government investment.
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