Grandparents who assist in caring for their grandchildren during the upcoming February half-term could potentially increase their state pension by up to £6,600. If you are below the state pension age and provide childcare for your grandkids, you may be eligible for Specified Adult Childcare Credits. These credits, categorized as National Insurance Credits, can help fill any gaps in your National Insurance record. Recent studies by Quilter indicate that each year of transferred credit can result in an additional £330 in state pension income by 2025/26, potentially totaling nearly £6,600 over a 20-year retirement period.
To qualify, you must have been below the state pension age (currently 66) when caring for the child, who should be under 12 years old, or under 17 if the child has a disability. There is no minimum hourly requirement to qualify for Specified Adult Childcare credits, meaning even occasional childcare can make you eligible. Claims can be backdated to 2011, allowing you to still claim even if you have stopped caring for the child.
The child’s parent must be receiving Child Benefit to transfer the National Insurance Credit to you without affecting their state pension forecast. It is crucial for the parent to ensure they are still building their National Insurance record for retirement.
Apart from grandparents, aunts, uncles, or anyone regularly caring for a child may also be eligible to make a claim. Most individuals need 35 qualifying National Insurance years to receive the full new state pension, valued at £230.25 per week, with a minimum of ten years required to receive any pension at all.
To claim Specified Adult Childcare Credits, you need to fill out form CA9176 on GOV.UK, signed by both you and the parent transferring the Credit. Recent data obtained through a Freedom of Information request by Quilter to HMRC reveals a significant number of applications for these credits, with a large portion successfully approved.
Jon Greer, head of retirement policy at Quilter, emphasizes the value of these credits, highlighting the lack of awareness among eligible individuals. He calls for increased government efforts to raise awareness of these credits, particularly targeting lower-income families and communities where gaps in National Insurance records are more prevalent.