Grandparents who looked after young children while parents worked are being urged to check an HMRC credit that could add thousands of pounds to their State Pension. Specified Adult Childcare Credits can fill gaps in a relative's National Insurance record if they cared for a child under 12 and the child's parent did not need the Child Benefit National Insurance credit themselves.
How the Credit Works
The credit is not a cash payment. It is a Class 3 National Insurance credit that can help protect State Pension entitlement, which is why missing it can be costly. The full new State Pension is £241.30 a week. For someone whose National Insurance record started after April 2016, one qualifying year is roughly worth 1/35th of the full rate, about £6.89 a week, or around £358 a year.
That means one missing qualifying year could be worth more than £7,100 over a 20-year retirement, before future pension rises are counted. The actual impact depends on the person's National Insurance record, whether they were contracted out and which State Pension rules apply to them.
Who Is Eligible?
The UK check is aimed at grandparents, great-grandparents, aunts, uncles, siblings and some partners or former partners who helped with childcare so a parent or main carer could work.
Key Checks for Families
- Was the child under 12 when the care was provided?
- Was the relative aged 16 or over, but under State Pension age, at the time?
- Was the relative ordinarily resident in the UK, not the Channel Islands or Isle of Man?
- Did the parent or main carer claim Child Benefit for the child?
- Does the parent or main carer already have a qualifying National Insurance year and therefore not need the Child Benefit credit?
- Does the relative have a gap in their own National Insurance record for that tax year?
- Can both the relative and the Child Benefit recipient sign the HMRC form?
- Is one person claiming the available credit for that Child Benefit claim?
Check Old Years Too
Families should also check old years, not just the most recent one. The credits were introduced from 6 April 2011, and claims can be made for earlier eligible tax years as well as recent years.
Timing Trap
There is a timing trap. HMRC says people must wait until 31 October after the end of the tax year they want to claim for, because the parent or main carer's National Insurance position has to be checked first.
The parent or main carer should check their National Insurance record online before signing away the credit. If they need the credit themselves, transferring it could damage their own State Pension record.
Expert Advice
Welfare Benefits Experts at Vettory.org say the biggest mistake families make is assuming informal childcare has no pension value. A spokesman said: "This is one of those HMRC checks that can look small on paper but matter years later. If a grandparent gave up work, reduced hours or simply was not building a full National Insurance year while helping with childcare, the family should check whether those credits can be transferred."
"The crucial point is that the parent must not need the credit themselves. Families should check both National Insurance records before applying, because the right answer is not always obvious. Do it before pension age where possible, because sorting missing years is much easier when there is still time to fix the record."
How to Apply
To apply, families use HMRC form CA9176. The applicant needs their own details, the child's details, the periods of care and the Child Benefit recipient's details. Both the applicant and the Child Benefit recipient must sign the declaration.
