By Lauren Howells

Up to 90,000 people who could be entitled to National Insurance credits for looking after a family member’s children while the family member goes back to work, may be missing out on building up a full state pension, according to Royal London.

Data obtained by the mutual life, pensions and investment company under the Freedom of Information Act, revealed that although the number of grandparents (or other family members) who were claiming the National Insurance credit, known formally as the Specified Adult Childcare Credit, had increased substantially, many more were still to claim.

Only 9,486 applied for Specified Adult Childcare Credit

HMRC figures obtained last year showed that only 1,298 grandparents or other family members had claimed Specified Adult Childcare Credit in the year from October 2015 to September 2016, compared to 9,486 applications in the year to September 2017.

Royal London has estimated that this most recent figure still only represents around 1 in 10 of the people who may be entitled to apply.

Specified Adult Childcare Credit terms

Specified Adult Childcare Credit: Grandparents Could Be Missing Out

Specified Adult Childcare Credit means that grandparents (or other family members) under the state pension age, who are looking after their grandchildren while the child’s main carer goes back to work, may be entitled to a credit to help them towards building up a full state pension.

It works by the person who is receiving the child benefit signing over the National Insurance credit that they receive as a child benefit recipient to the grandparent (or another family member). As they are now back at work, they will not need the credit because they are paying their own National Insurance Contributions.

The full eligibility criteria and details of how to apply are available on the government website.

According to Royal London, a grandparent who cares for a grandchild for one year could add around £230 per year onto their state pension they receive in retirement, which over a typical twenty-year retirement could be worth more than £4,500.

 “They should not also damage their own state pension prospects”

Steve Webb, Director of Policy at Royal London said: “It is right and proper that when grandparents sacrifice their own working life to help a family member get back to work, they should not also damage their own state pension prospects.

“This National Insurance credit is a valuable right and it is good news that the numbers claiming have risen so dramatically in such a short space of time”.

Mr. Webb added that he would encourage the tens of thousands more grandparents who could be entitled to benefit, to find out about the scheme and make a claim.