Grandparents who help with childcare may be eligible for Specified Adult Childcare Credits (SACCs) that can boost their state pension, according to wealth manager Quilter. Data obtained from HM Revenue and Customs (HMRC) via a freedom of information request shows that 202,037 applications were made between 2016-17 and 2024-25, with 79% (159,116) approved.
Rise in Applications
Applications surged from 29,967 in 2022-23 to 42,964 in 2023-24. HMRC attributed the increase to media coverage that raised awareness of the scheme. The credits are designed to help people below state pension age build up their state pension rights and fill gaps in national insurance (NI) records.
How the Credits Work
The credits transfer the weekly NI credit that a parent or carer receives as a child benefit recipient to an eligible family member. Grandparents may qualify if they provide care for a child under 12 and the parent or main carer does not need the NI credits themselves. Quilter emphasized the importance of maintaining a child benefit claim, as opting out entirely means no NI credits are available to transfer.
Impact on Retirement Incomes
Jon Greer, head of retirement policy at Quilter, said: “For many people, securing the full state pension is a key foundation of later life income, and these credits can offer grandparents a relatively simple way to strengthen their entitlement while helping family with childcare.” He added that the significant number of unsuccessful applications points to a need for clearer guidance on eligibility and the system's practical workings.
Reasons for Rejection
Reasons for rejection may include applicants already having a qualifying year of NI, often because they are still working or receiving other credits. Greer noted that with childcare costs rising, grandparents play an increasingly important role in supporting working families, and ensuring access to pension benefits linked to that support is crucial.
Broader Implications
The credits can be particularly valuable for addressing gaps in NI records that often arise from time spent out of the workforce, disproportionately affecting women. Quilter stressed that as families rely more on informal childcare, understanding and using these credits will become more important.
