Grandparents Urged to Claim Pension Boost for Summer Childcare Support

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Grandparents who regularly care for their grandchildren during school holidays could be eligible for a valuable top-up to their State Pension, according to guidance from HM Revenue and Customs (HMRC). With the potential to earn an extra £303 per year, this benefit could see retirees better off by over £6,000 over the course of two decades.

The support comes in the form of National Insurance (NI) credits, which can be claimed by qualifying family members looking after children under the age of 12. While often overlooked, these credits can play a vital role in plugging gaps in an individual’s NI record, helping them to qualify for or increase their State Pension.

Pension Credits

The scheme in question is known as the Specified Adult Childcare Credit. It rewards informal childcare provided by family members, typically to allow parents to work. For each week care is given, a Class 3 NI credit can be claimed, contributing directly to the carer’s pension entitlement. One credit equates to roughly £303 per year in pension value.

Importantly, only one credit is available per Child Benefit claim, regardless of how many children are included. So if two grandparents look after two grandchildren from the same household, only one can receive the credit. However, a second credit may be available if they also care for a child from another household where a separate Child Benefit claim has been made.

Eligibility is open to U.K. residents (excluding the Channel Islands and the Isle of Man) who were between 16 and State Pension age when they cared for the child. The parent or guardian who receives Child Benefit must also sign the form to confirm care was provided during the stated period.

The scheme recognises a wide range of family members, including grandparents, great-grandparents, siblings, aunts, uncles, and relatives by marriage or civil partnership. Those who provided childcare remotely during the COVID-19 pandemic, via calls or video, may also qualify for credits for the 2019/20 and 2020/21 tax years.

Backdated claims can be made as far back as April 6, 2011, offering many opportunities to recover lost years of NI contributions. For those nearing retirement, this could be particularly significant. Around 35 qualifying years are typically needed for the full new State Pension, which is currently worth £230.25 a week or £11,973 a year. A minimum of 10 years is required to qualify for any payment at all.

To apply, individuals must fill out the CA9176 form on the GOV.UK website and ensure it is signed by the child’s parent or guardian. It’s a straightforward process that could have a lasting impact on retirement finances.

As living costs continue to rise, this little-known scheme is a meaningful way for those who already support their families to ensure they receive the financial credit they deserve.