State pension update as grandparents can claim £6,000 boost | Personal Finance | Finance
Almost 20,000 grandparents increased their state pension last year just by looking after their grandchildren, new figures show. But thousands more could be left out of around £6,600 in extra retirement income. The support comes from certain adult childcare credits, a type of national insurance credit designed to help carers qualify for a full state pension.
These credits can be claimed if a parent receiving child benefit pays national insurance and another family member provides childcare. To benefit from this right, the child must be under the age of 12 and the caregiver can be a grandparent, aunt, uncle or older sibling. Full-time care is not required; Credit may be claimed for school drop-offs, school holidays or other periods of childcare.
Claiming these credits could fill gaps in national insurance records and help people cover the 35 years required for the new state pension, which currently pays £230.25 a week.
Each year of credited childcare could increase the pension by £330, meaning a 20-year pension could see an increase of around £6,600.
Although only 79% of applications were approved, just over 109,000 people have successfully taken out the loans since their launch in 2011.
Last year, 19,621 people applied for a loan, while 5,220 applications were rejected; This was usually because the carer had already had an entitlement year, was receiving child benefit himself, or had made an incomplete application.
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Applicants can back their application back to 2011 to maximize their state pension, and must wait until 31 October to apply for the current tax year to ensure the parent or primary carer already has a year of national insurance eligibility.
Those wishing to apply will need the child’s details, records of the care provided and contact details of the parent receiving child benefit.
Both the carer and parent must sign a declaration and form CA9176 can be completed online and sent by post to HMRC. Applicants can then track the progress of their request online.
This program offers grandparents and other family caregivers a valuable opportunity to increase their retirement income while supporting younger generations.
