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 state pension age and provide childcare for your grandchildren, you may be eligible for Specified Adult Childcare Credits. These credits are a form of National Insurance Credits designed to fill any gaps in your National Insurance record. Research by Quilter indicates that each year of transferred credit could result in an extra £330 in state pension income annually by 2025/26, potentially accumulating to nearly £6,600 over a 20-year retirement period.
To qualify for these credits, you must have been under state pension age (currently 66) while caring for the child, who should be under 12 years of age or under 17 if they have a disability. There is no specific minimum number of hours required to qualify for these credits, making it possible to be eligible even if you cared for the child just one day a week. Claims for these credits can also be backdated to 2011, allowing individuals who have stopped providing care for the child to still apply.
It is essential that the parent of the child receives Child Benefit, as they will be transferring the National Insurance Credits they receive to the grandparent. It is important for the parent to ensure that they continue to build up their own National Insurance record for retirement, so their state pension forecast remains unaffected. Not only grandparents but also aunties, uncles, or anyone regularly caring for a child can make a claim for these credits.
Most individuals need 35 qualifying National Insurance years to claim the full new state pension, which is valued at £230.25 per week. A minimum of ten years is typically required to receive any pension benefits. To apply for Specified Adult Childcare Credits, the form CA9176 on GOV.UK must be completed, signed by both the claimant and the parent transferring the Credit.
Recent data from a Freedom of Information request to HMRC by Quilter shows that there were 42,964 applications for Specified Adult Childcare Credits between October 2023 and September 2024. In the past five years, a total of 131,594 applications were submitted, with 104,433 approvals granted.
Jon Greer, head of retirement policy at Quilter, emphasized the significance of these credits, stating that each year of credit amounts to £330 towards one’s state pension, yet awareness about them remains low. He urged the government to increase awareness of these credits, especially among lower-income families and communities where gaps in National Insurance records are more common.