Grandparents can get £6,600 pension boost for looking after kids during summer holidays – but thousands miss out
Many grandparents are unaware they can be financially compensated for the time spent looking after their grandchildren.
1
It comes as 53% of grandparents with grandchildren aged under 18 will step in to look after them this summer, according to research by MyVoucherCodes.
And they are expected to pay more than £21 per day on each child on average, according to the survey.
This was up from £15.80 per day when the website commissioned a similar survey in 2024.
Sarah-Jane Outten, consumer and shopping expert at MyVoucherCodes, said: 'It's clear to see that many parents across the UK are calling on grandparents to step in to help with childcare, but for some, the generosity is coming at a cost."
But there is a way for grandparents to get extra support.
Specified adult childcare credits are a type of National Insurance (NI) credit that can help you qualify for the full state pension.
You need 35 years' worth of NI contributions to get the full amount worth £230.25 a week.
It means parents and other relatives looking after a child under 12 can give their pension a boost.
Recent research obtained by wealth manager Quilter from HMRC found only 104,433 people have successfully claimed the credits in the past five years.
Just 42,962 people applied for the credits last year, even though 78% of applications are successful.
Cash for Care
Every year of transferred credit will boost your state pension by £330 a year.
This could add nearly £6,600 to the value of your state pension over the course of a 20-year retirement.
You can also backdate your claim to 2011, when the credits were first introduced.
Who is eligible?
You can claim if you are an eligible family member and responsible for caring for a child whose parents claim child benefit; otherwise, there are no national insurance credits to transfer.
Moreover, there is only one credit available per child benefit claim, regardless of the number of children.
So even if you care for two of your grandchildren, only one credit can be transferred to you.
It is also important to note that the credits are available for transfer only if you are under the state pension age.
The child you are caring for must also be under 12 years old, or 17 if they have disabilities.
To claim, you must live in England, Scotland, Wales and Northern Ireland, but not the Channel Islands or the Isle of Man.
How do I claim?
You need to wait until October 31 to apply for the current tax year.
This is because HMRC needs to check that the parent or main carer already has a qualifying year of National Insurance.
They should check their National Insurance record to make sure they have credits they can transfer.
Parents and carers can check their National Insurance record on the gov.uk website.
Before you apply for the credits you will need the child's details and a record of the periods when you provided care for them.
You will also need the contact details of the child's parent or main carer who receives the child benefit.
Both you and the person who receives the child benefit must sign a declaration on the application form.
You then need to complete the CA9176 form online.
What are the different types of pensions?
WE round-up the main types of pension and how they differ:
Personal pension or self-invested personal pension (SIPP) - This is probably the most flexible type of pension as you can choose your own provider and how much you invest.
Workplace pension - The Government has made it compulsory for employers to automatically enrol you in your workplace pension unless you opt out.
These so-called defined contribution (DC) pensions are usually chosen by your employer and you won't be able to change it. Minimum contributions are 8%, with employees paying 5% (1% in tax relief) and employers contributing 3%.
Final salary pension - This is also a workplace pension but here, what you get in retirement is decided based on your salary, and you'll be paid a set amount each year upon retiring. It's often referred to as a gold-plated pension or a defined benefit (DB) pension. But they're not typically offered by employers anymore.
New state pension - This is what the state pays to those who reach state pension age after April 6 2016. The maximum payout is £203.85 a week and you'll need 35 years of National Insurance contributions to get this. You also need at least ten years' worth to qualify for anything at all.
Basic state pension - If you reach the state pension age on or before April 2016, you'll get the basic state pension. The full amount is £156.20 per week and you'll need 30 years of National Insurance contributions to get this. If you have the basic state pension you may also get a top-up from what's known as the additional or second state pension. Those who have built up National Insurance contributions under both the basic and new state pensions will get a combination of both schemes.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
BBC News
an hour ago
- BBC News
Ban some foreigners from sickness benefits, Badenoch urges
Kemi Badenoch will call for foreign nationals to be barred from claiming disability and sickness benefits, as she sets out plans for tighter curbs on a speech on Thursday, the Tory leader will describe Britain's benefits bill as a "ticking time bomb" that could "collapse the economy".It comes after the party outlined some of its own proposals to reduce spending, after Labour largely gutted its own plan for benefits cuts after a backbench to bring in remaining government cuts to sickness benefits was approved by MPs on Wednesday evening. But other proposals, including changes to the eligibility criteria for disability benefits, have effectively been put on hold. The government announced plans to shrink welfare spending in March, warning the working-age welfare bill was set to rise by nearly £30bn by 2030 and reforms to the system were required to ensure it remained wanted to make it harder to claim personal independence payment (Pip), the main disability benefit in England, Wales and Northern Ireland, and make health-related top-ups for universal credit less generous. But ministers significantly watered down the cuts earlier this month after a huge rebellion from Labour MPs, all but wiping out savings estimated to be worth £5bn a year by the end of the decade. Plans to freeze the higher rate of universal credit for existing health-related claimants have been reversed, whilst all changes to the Pip system have been parked pending a government review into the assessment her speech on Thursday, Badenoch will accuse Labour of being "beholden to left-wing MPs" and "turning a blind eye" to rising benefit will also seek to create a dividing line with Reform UK over the two-child benefit cap, which Nigel Farage's party has pledged to scrap, branding him "Jeremy Corbyn with a pint and a cigarette"."On welfare he shows his true colours - promising unaffordable giveaways with no plan to fix the system," she is expected to add.A Labour spokesperson said "The Conservatives had 14 years to reform welfare - instead, they left the country with a broken system that holds people back and fails to support the most vulnerable."The party also warned that the Conservative proposal could see disabled British nationals living abroad being denied support if other countries decided to take a similar approach. Tory welfare proposals The Conservatives have not backed the government's legislation to deliver the changes, arguing its proposals do not go far have set out some plans of their own to shrink welfare spending in the form of amendments to the government's plans, which were defeated on include limiting access to Pips and the health-related part of universal credit to those with "less severe" mental health conditions, and preventing claimants from receiving payments without a face-to-face also say both benefits should only be paid to British citizens, with exceptions for those covered by international agreements, such as citizens from EU countries who have acquired settled status in the the moment, foreign nationals gain access to the welfare system when they are granted indefinite leave to remain or refugee status. Applicants for Pip generally need to have lived in Britain for at least two of the last three seekers are not allowed to apply for benefits, although they have access to taxpayer-funded accommodation and separate financial shadow minister Neil O'Brien has said he has obtained figures under freedom of information laws showing universal credit payments to households containing at least one foreign national stood at £941m a month as of working out the exact scale of payments to non-UK nationals specifically is complicated, because the Department for Work and Pensions does not provide a breakdown of claimants by immigration status and the department is due to publish the first such breakdown next week, and has committed to updates every three months thereafter. Sign up for our Politics Essential newsletter to read top political analysis, gain insight from across the UK and stay up to speed with the big moments. It'll be delivered straight to your inbox every weekday.
Reuters
2 hours ago
- Reuters
UK housing market steadies after tax hike downturn, RICS says
MANCHESTER, England, July 10 (Reuters) - A downturn in Britain's housing market that followed a tax hike on property transactions in April eased off in June, according to chartered surveyors who expect a broadly flat picture in the months ahead. The Royal Institution of Chartered Surveyors said on Thursday its measure of new buyer enquiries turned positive for first time since December and agreed sales also improved. But the change suggested a stable market rather than an upturn. A balance of house prices was steady at -7%, meaning more surveyors reporting prices fell than rose, with London and the south east of England among the regions with the biggest drops. The survey chimed with other signs of a subdued property market after buyers rushed earlier in the year to beat the March 31 expiry of a tax break for some home purchases. Earlier this week, mortgage lender Halifax said house prices were flat last month. An expected further drop in interest rates later this year is likely to help the market, analysts have said. "The UK residential market appears to be entering a more settled phase, with demand showing signs of stabilising following a period of volatility," said Tarrant Parsons, RICS head of market research and analysis. "The earlier distortion caused by transactions being brought forward ahead of the Stamp Duty changes now appears to have largely dissipated, allowing underlying trends to re-emerge." Parsons pointed to a modest increase in expectations for sales in the near term but he said economic uncertainty - at home and globally - could hit activity.
The Guardian
2 hours ago
- The Guardian
Is it time for a wealth tax on the super-rich?
After cuts in Labour's proposed welfare reform bill caused uproar, many of the party's supporters insist it's time for a different approach. Rather than cutting the benefits bill or public spending, why not tax the wealthiest more? It's a question Keir Starmer was asked in PMQs, and he replied by saying it wasn't possible to 'tax our way to growth'. The millionaire Dale Vince disagrees. A former new-age traveller who made his money in green energy and has donated to Just Stop Oil, he is part of the Patriotic Millionaires organisation who think it is high time people like them are asked to increase their contributions. 'There's a whole bunch of us. We're all saying the same thing, that we can afford to pay more tax. Rich people should pay more tax, and we can use that money to reduce inequality in our country.' The tax expert and economics professor Arun Advani explains how a wealth tax could work and what the dangers could be. Would it send millionaires fleeing from the UK – and would that matter? And what other levers are at the government's disposal?
