It is common to repeat a level and it depends on the gym as to how they handle moving kids up. The kip is a really hard skill for kids to get and yes, the kids are at a disadvantage if they don't work that skill until the summer and then have only a short time to get it. My daughter struggled to get a kip and was told she could not move up to L4 as a result. A couple of weeks later, the gym changed their minds and my daughter got her kip in the meanwhile and they moved the 3-4 girls they were holding back up to L4.
She was thrilled to move up. The good thing about that year of L4 is that she was challenged and she could work her upgrades. The bad thing about it was she was at the bottom of the podium for vault and bars all season. L4 bars are hard and the judging is tough. They need straight arms in the kip and a tight body position throughout and they need speed throughout the routine and it takes time for that to develop especially if you have a kid who isn't a natural bar worker. She wound up repeating L4 as a result and had a much stronger year of L4 where she started to consistently score 9s on bars. She was much more ready to move on to L5 after the 2nd year of L4.
So, it just depends on the gym. If your child does not quite have the skills when they move to L4, it may be fine but you may be in for a rough season of scoring. When they repeat a level, they have more confidence and and can really succeed in the meets and can be more ready to move to the next level. When they are a bit behind, it is like they have to be held back at some point to catch up.
Problem with L4 is that they cannot compete bars at all without a kip.