State pension update: Thousands claiming £300 a year retirement boost - can you?

What is SACC?

Grandparents and other family members looking after children under the age of 12 years old have the chance to raise their pension pot thanks to Specified Adult Childcare Credits.

When a child’s parent or primary carer is employed or self-employed, and paying National Insurance contributions (NICs), they may not need the extra contributions they receive from Child Benefit claims.

As such, these additional credits can then be transferred to the caregiver which could see their state pension raised by up to £328 a year.

According to wealth management firm Quilter, this could see the standard retirement in receipt of a National Insurance boost worth more than £6,000.

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This credit scheme was put in place by the Government in 2011 to make sure anyone below the state pension age, who has left the workforce to care for children, remains entitled to their full retirement benefit.

Notably, there is no minimum number of hours someone needs to have been looking after a child to claim these extra National Insurance credits.

Based on a Freedom of Information (FoI) submitted to HMRC, 19,616 Britons apply for SACC every year with around 15,400 applications eventually being successful. Overall, 123,128 people are in receipt of the credit.

Among the reasons someone may have their application rejected include if they already have a qualifying year of National Insurance under their belt.

This is usually because they have previously worked or receive other National Insurance credits or they are claiming Child Credit.

Someone is entitled to claim if they are an eligible family member and responsible for caring for a child whose parents claim Child Benefit.

Furthermore, there is only one credit available per Child Benefit claim. This means only one credit will be transferred over to the carer even if they are looking after more than one child.

Credits are available for transfer only if someone is under the state pension age, with claims being backdated to April 6, 2011.

Jon Greer, the head of retirement policy at Quilter, urged those preparing financially for later life to make sure they are taking advantage of credits which could significantly

He explained: "It is fantastic to see more grandparents and other family members take advantage of Specified Adult Childcare Credits. The numbers of people applying for the credit have been steadily climbing and last year saw the most people apply on record with this year set to top that.

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"These credits are not only crucial for securing the full state pension if you have gaps in your National Insurance record, but they are also a cost-effective method of doing so, versus paying to fill in missed years.

"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.

"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 especially over the summer months when working parents struggle with the rising costs of childcare and grandparents step in to save the day."