Grandparents who assist in caring for their grandchildren during the February half-term could potentially increase their state pension by £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 are a form of National Insurance Credits that can help fill any gaps in your National Insurance record.
Research conducted by Quilter indicates that each year of transferred credit can result in an extra £330 in state pension income by 2025/26, potentially accumulating to nearly £6,600 over a 20-year retirement period. To qualify, you must have been under the state pension age (currently 66) when caring for the child, and the child must be under 12 years old, or under 17 if they have a disability.
There is no specific minimum number of hours required to be eligible for Specified Adult Childcare credits, allowing even those who looked after the child one day a week to qualify. Claims can also be backdated to 2011, enabling individuals who have stopped providing childcare to still make a claim.
To be eligible, the parent of the child must be receiving Child Benefit, as they will be transferring their National Insurance Credit to the grandparent. It is crucial for the parent to ensure that they continue building their own National Insurance record for retirement, preserving their state pension forecast.
Not limited to grandparents, aunts, uncles, or any regular caregiver of a child can also make a claim for these credits. Most individuals need 35 qualifying National Insurance years to receive the full new state pension, currently valued at £230.25 per week, with a minimum requirement of ten years to receive any amount.
To claim Specified Adult Childcare Credits, you must fill out form CA9176 on GOV.UK, signed by both you and the parent transferring the Credit. Recent data from a Freedom of Information request by Quilter to HMRC revealed that there were 42,964 applications for these credits between October 2023 and September 2024. In the past five years, a total of 131,594 applications were submitted, with 104,433 successfully approved.
Jon Greer, head of retirement policy at Quilter, emphasized the importance of raising awareness about these credits, highlighting that each year of credit can significantly impact state pension income. He mentioned that many eligible individuals might be missing out on substantial sums due to lack of awareness or knowledge on how to apply. Greer also called for government efforts to increase awareness, particularly among lower-income families and communities where gaps in National Insurance records are more common.