Are you a grandparent who loves spending time with your grandkids? You might be sitting on a hidden pension fortune!
A new scheme means you can boost your state pension by up to £20,000 just by helping out with childcare.
This is how it works:
Looking After Grandkids? It’s Worth More Than You Think!
The Daily Mail featured the story of Mike Wagner (name changed), a 70-year-old retired project manager, discovered this amazing scheme after he realised he wouldn’t have enough National Insurance contributions to get the full state pension.
Mike was short of contributions, meaning he’d be missing out on £1,300 a year.
Then he found out about Specified Adult Childcare credits – also known as grandparent credit.
These credits are available for family members who look after children under 12 years old, as long as it helps their parents to keep working.
The parent must be registered for child benefit and paying National Insurance.
Child Benefit & Grandparents – What You Need To Know
Parents who earn up to £60,000 a year get the full child benefit, which is worth up to £1,331 a year for the first child, and up to £881 a year for each additional child.
Even if one parent earns more than £80,000, they can still get the benefit which will provide them with National Insurance credits towards their pension. However, they will need to pay back the benefit through their tax return.
Even if you look after your grandchildren for just a few hours a week, you could still be eligible.
How Much Can You Earn?
Each year of childcare credits is equal to a year of National Insurance contributions, or one-35th of the full state pension. This works out to around £6.32 a week, or £328.64 a year.
Mike was able to claim for three years of missing contributions, adding an extra £18.96 a week, or £986 a year, to his state pension. Over 20 years of retirement, that’s a whopping £19,718 extra!
How To Claim Your Grandparent Credit
You need to complete a form online and send it to HMRC.
The child’s parents will also need to sign the document to confirm that you looked after their child and they are happy to transfer the National Insurance credits to you.
You can claim backdated to April 6, 2011, so don’t delay!
Don’t miss out on this great opportunity to boost your pension.
Talk to your family and see if you’re eligible!