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State pension warning as thousands unable to get access to vital National Insurance credit

Quilter’s research into HM Revenue and Customs (HMRC) figures found that there have been around 78,000 applications for Specified Adult Childcare Credits (SACC) over the past five years. However, nearly 16,800 of these applications have been rejected over the same period of time. SACC credits allow a grandparent or other guardian who cares for a child under 12 to receive Class 3 National Insurance credits if the primary carer is working.

This system was introduced by the Government in 2011 to provide support to those who had stopped working below the state pension age to look after children.

Through SACC, carers below the age of 66 are still able to rack up vital adult childcare National Insurance credits to boost their state pension pot.

On an average year, 15,580 Britons apply for the credit with around 12,385 applications being successful, according to a Freedom of Information request sent to HMRC by Quilter.

Over the last five years, the number of successful adult childcare National Insurance recipients stands at 61,927.

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According to Quilter, one of the main reasons people find their application rejected is because the applicant has a prior year of qualifying for National Insurance, which is commonly due to working or receiving other NI credits.

Furthermore, if someone already receives Child Benefit, they will already be getting the parents’ National Insurance credits automatically.

Back in 2018, the Government predicted around 100,000 people could receive assistance from the scheme but revealed that only 19,000 people had claimed the credit since its inception.

Due to this, Quilter estimates that 20,000 people are still “missing out” on crucial National Insurance credits.

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Shaun Moore, Tax and Financial Planning expert at Quilter, outlined his concerns with many Britons having their applications unceremoniously rejected.

Mr Moore said: “It is fantastic to see more grandparents and other family members take advantage of Specified Adult Childcare Credits.

“However, the numbers of people benefitting from the credits still pales in comparison to the predicted number of people the scheme was intended to help.

“What’s more worrying is that such a significant proportion of applications are being rejected, which may put people off applying in the future.”

Specifically, the tax expert emphasised the importance the credits would be in the lives of grandparents who are currently aged below the new state pension age.

“Grandparents play a vital role in providing childcare as the costs of getting it privately are disproportionate to most people’s pay packets,” Mr Moore explained.

“We estimate that the government’s 100,000 figure is vastly underestimated so there may be many thousands more who could benefit from these credits which are so crucial to ensuring someone receives the full state pension if they have gaps in their National Insurance record.

“It’s worth knowing too that the number of hours a grandparent helps out with childcare is irrelevant to the claim.

“Even if it’s just one day a week, eligible grandparents should be able to claim.”

On top of this, Mr Moore explained how those who have had their care responsibilities affected by the pandemic will still be able to claim.

He added: “Similarly, for those worried that due to the pandemic usual caring duties have been impossible the Government confirmed that care given by telephone or Zoom can count, among other ways of caring remotely.

“More needs to be done to highlight that these credits are available and to educate people on how to correctly apply so they avoid rejection.

“If not, this unsung workforce of child carers will fail to benefit despite playing a critical role in keeping the economy going.”

People living in the UK can check their eligibility for National Insurance credits on the Gov.co.uk website.



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