[BUG] [CRITICAL BUG] VSCode Extension: Re-authentication causes 401 error, has Extra Usage Enabled stuck at false, Max plan not recognized

Preflight Checklist

• [x] I have searched existing issues and this hasn't been reported yet
• [x] This is a single bug report (please file separate reports for different bugs)
• [x] I am using the latest version of Claude Code

What's Wrong?

After re-authenticating in Claude Code VSCode extension (v2.1.5) on Jan 12, 2026, the subscription API returns 401 error and sets hasExtraUsageEnabled: false in ~/.claude.json, despite having an active Max plan - 5x subscription (£90/month, Invoice 89CF8798-0009).

This causes the system to silently downgrade from Sonnet to Haiku model without any error notification. The UI still shows "Sonnet 4.5" but logs confirm Haiku is actually running.

TIMELINE:

• Dec 4, 2025 - Jan 11, 2026: Used Opus + Sonnet successfully (no Haiku ever used)
• Jan 12, 2026 at 12:48 GMT: Re-logged into Claude Code VSCode extension
• Jan 12, 2026 at 12:51:10 GMT: Started getting "Failed to fetch subscription: AxiosError: 401"
• Jan 12, 2026 at 12:48:42 GMT: System switched to Haiku for the FIRST TIME

EVIDENCE:

• Log line 511: "Failed to fetch subscription: AxiosError: Request failed with status code 401"
• Log line 134: "Tool search disabled for model 'claude-haiku-4-5-20251001'"
• ~/.claude.json shows: "hasExtraUsageEnabled": false (should be true for Max plan)
• settings.json shows: "claudeCode.selectedModel": "claude-sonnet-4-5-20250929" (user selected Sonnet)

IMPACT:

• Paying £90/month for Max plan but receiving free tier functionality (Haiku)
• No error notification shown to user about downgrade
• UI shows "Sonnet" while actually running "Haiku" (misleading)

ACCOUNT:

• Email: atlitude@mail.com
• Account UUID: bd421421-2133-47ed-ae66-59e786088a65
• Organization UUID: 17140a2e-1f56-4155-a307-84818a65dc53
• Invoice: 89CF8798-0009 (Max plan - 5x, valid Jan 7 - Feb 7, 2026)

The re-authentication generated new OAuth tokens that are not properly linked to my paid subscription in the backend database, causing the subscription verification endpoint to return 401.

<img width="730" height="624" alt="Image" src="https://github.com/user-attachments/assets/1f2ab04b-18c2-4047-917a-5c22a8fdef1a" />

<img width="1133" height="655" alt="Image" src="https://github.com/user-attachments/assets/dd344352-a8f7-4da4-81e4-683e4787ed35" />

<img width="1245" height="658" alt="Image" src="https://github.com/user-attachments/assets/dd754403-9a68-4ee2-9acf-d99b5875fb5f" />

What Should Happen?

1. OAuth login completes successfully
2. Extension attempts to fetch subscription status from API
3. API recognizes my paid Max plan - 5x subscription (Invoice 89CF8798-0009)
4. ~/.claude.json is updated with "hasExtraUsageEnabled": true
5. Sonnet/Opus models remain available as per my Max plan subscription
6. No silent downgrade to Haiku
7. If subscription verification fails, user should see clear error notification with actionable steps

Expected result: I continue using Sonnet model with 5x usage limits as paid for in my £90/month Max plan subscription.

Error Messages/Logs

=== LOG FILE PATH ===
~/.config/Code/logs/20260112T124835/window1/exthost/Anthropic.claude-code/Claude VSCode.log

=== ERROR 401 - Subscription Fetch Failure (Line 511) ===
2026-01-12 12:51:10.929 [error] Failed to fetch subscription: AxiosError: Request failed with status code 401

=== CONTEXT AROUND ERROR 401 (Lines 507-513) ===
2026-01-12 12:51:10.398 [info] Received message from webview: {"type":"request","requestId":"u7snofwg4et","request":{"type":"submit_oauth_code","code":"XVMgHr8eKRxKsmTp12eWdTVyMRkU5SzhvhL4dt1JXqKNYaTs#EbrU7RRK7PdPBT7sEUK4nVbAeySw513OVil0t37f97U"}}
2026-01-12 12:51:10.399 [info] Handling manual auth code input
2026-01-12 12:51:10.929 [error] Failed to fetch subscription: AxiosError: Request failed with status code 401
2026-01-12 12:51:10.929 [info] Saving OAuth tokens to secure storage
2026-01-12 12:51:10.929 [info] Login successful
2026-01-12 12:51:10.929 [info] Getting authentication status

=== HAIKU MODEL RUNNING - Should be Sonnet (Line 134) ===
2026-01-12 12:48:42.804 [info] From claude: 2026-01-12T12:48:42.804Z [DEBUG] Tool search disabled for model 'claude-haiku-4-5-20251001': model does not support tool_reference blocks. This feature is only available on Claude Sonnet 4+, Opus 4+, and newer models.

=== CONFIG FILE: ~/.claude.json (Relevant Section) ===
{
  "oauthAccount": {
    "accountUuid": "bd421421-2133-47ed-ae66-59e786088a65",
    "emailAddress": "atlitude@mail.com",
    "organizationUuid": "17140a2e-1f56-4155-a307-84818a65dc53",
    "hasExtraUsageEnabled": false,
    "displayName": "Bob"
  }
}

=== USER SETTINGS: ~/.config/Code/User/settings.json (Line 46) ===
"claudeCode.selectedModel": "claude-sonnet-4-5-20250929"

Steps to Reproduce

1. Have an active Max plan - 5x subscription (confirmed with Invoice 89CF8798-0009, £90.00, valid Jan 7 - Feb 7, 2026)
2. Install Claude Code VSCode extension v2.1.5
3. Use Claude Code normally with Opus/Sonnet models for several weeks (works fine)
4. Open VSCode Command Palette (Ctrl+Shift+P)
5. Run: "Claude Code: Logout"
6. Close and reopen VSCode
7. Launch Claude Code again
8. Complete OAuth authentication flow (login via claude.ai)
9. Observe in logs: "Failed to fetch subscription: AxiosError: Request failed with status code 401"
10. Check ~/.claude.json - see "hasExtraUsageEnabled": false (should be true)
11. Notice system silently switched to Haiku model despite Sonnet being selected in settings
12. UI still shows "Sonnet 4.5" but logs confirm Haiku is running

Claude Model

Sonnet (default)

Is this a regression?

I don't know

Last Working Version

_No response_

Claude Code Version

2.1.6

Platform

Other

Operating System

Ubuntu/Debian Linux

Terminal/Shell

Other

Additional Information

ENVIRONMENT:

• VSCode Extension: anthropic.claude-code v2.1.6
• OS: Linux Debian 6.1.0-42-amd64
• VSCode: Latest version
• Installation method: VSCode Marketplace

SUBSCRIPTION DETAILS:

• Plan: Max plan - 5x (£90.00/month)
• Invoice: 89CF8798-0009
• Payment date: January 7, 2026
• Valid until: February 7, 2026
• Account email: atlitude@mail.com

WHAT I'VE TRIED:

1. Logged out and logged back in (Jan 12 at 12:48 GMT) - didn't help
2. Contacted support - received incorrect instructions for CLI version instead of VSCode extension
3. Support bot declined refund citing "previously issued refund" (unrelated issue from Jan 10)
4. Manually set selectedModel in settings.json to force Sonnet (temporary workaround)

HISTORICAL DATA:

• Extension installed: Dec 4, 2025
• Dec 4 - Jan 11: Used Opus + Sonnet successfully (NO Haiku ever)
• Jan 12 after re-login: Haiku appeared for the FIRST TIME
• stats-cache.json confirms NO Haiku usage before Jan 12

ROOT CAUSE HYPOTHESIS:
Re-authentication on Jan 12 generated new OAuth tokens that are not properly linked to my paid subscription (Invoice 89CF8798-0009) in the backend database, causing the subscription API to return 401.

WORKAROUND:
Set "claudeCode.selectedModel": "claude-sonnet-4-5-20250929" in ~/.config/Code/User/settings.json
Note: This doesn't fix has Extra Usage Enabled: false, so I'm still not getting 5x usage limits.

RELATED ISSUES:

• #6330 - Max plan subscribers shown as Pro users
• #12249 - Using API credits instead of subscription
• #16157 - Usage limits issues with Max subscription