Two-thirds of adults in the UK provided unpaid care for older, sick or disabled relatives between 1991 and 2018, according to Carers UK.
The carers’ charity said that 70% of women take on caring responsibilities, compared with 60% of men.
Female carers also tend to start earlier: half of the UK’s women take on caring responsibilities by the age of 46, while half of men are doing the same by the time they’re 57.
Here, Which? explains how being a parent or carer can affect your state pension, and explains four things you can do to top yours up.
How does being a carer affect your state pension?
Being a parent or carer often means that people have to reduce the number of hours they work, or take time out altogether. This means they could face a considerable reduction in their state pension entitlement.
Following changes in 2016, you need to build up 35 years’ worth of National Insurance contributions to qualify for the full new state pension and 10 years to be eligible for any payment at all.
The good news is that National insurance credits allow you to fill gaps on your National Insurance record when you’re not working and unable to make National Insurance contributions. They help you build up ‘qualifying years’, which count towards your entitlement for the state pension and other benefits too.
Some credits are applied automatically whereas others will need to be applied for.
Follow these four steps to ensure you’ll get the full amount of state pension you’re entitled to.
1) Check your state pension
It’s really important to check your state pension entitlement to help determine how much you’re likely to receive when you reach state pension age – and whether you’ll need to top it up. You can get your state pension forecast on Gov.uk.
The state pension age for women has been steadily rising to 65, to bring it in line with the retirement age for men. The state pension age is now 65 for both men and women and will increase to 66 by October 2020.
The table below shows the government’s timeline for state pension age increases:
|Date||State pension age|
*This date has been announced but not yet legislated for. It was originally timetabled for 2044-2046 and could be subject to change again.
- Find out more: state pension age calculator
2) Apply for carer’s credit
Carer’s credit was introduced by the government in 2010 to help carers fill gaps on their National Insurance record.
To qualify for it you must be between 16 and the state pension age and provide at least 20 hours of care a week for a disabled person who is receiving:
- Disability Living Allowance care component at the middle or highest rate;
- Attendance Allowance;
- Constant Attendance Allowance;
- Personal Independence Payment – daily living component at the standard enhance rate; or
- Armed Forces Independent payment.
If the person being cared for does not get one of the benefits listed above, your application must be signed by a health or social care professional (such as a GP), who can confirm the details on the application.
To apply for carer’s credit, you will need to complete the carer’s credit form on Gov.uk.
The form includes a carer’s certificate, which must be signed by a health and social care professional.
If you need a printed version of the application form or a different format (such as braille), contact the Carer’s Allowance Unit.
- Find out more: what is National Insurance?
3) Claim child benefit
If you are caring for a child, you could be eligible for child benefit. Your child must be under 16 or, if they’re in an approved form of education or training, under 20.
Any full tax year (from 6 April to 5 April the following year) in which you claim child benefit counts as a qualifying year towards state pension until your youngest child is 12. If your claim falls outside the full tax year, you will end up missing state pension qualifying years.
The payments are tax-free if the combined income of you and your partner is less than £50,000 a year.
It’s important to note that only one person can claim child benefit per child. If one parent is taking time out of work to care for the child, they should be the named claimant for child benefit in order to receive National Insurance credits, which will help build up their state pension entitlement.
Around 200,000 couples are risking their state pension entitlement by naming the wrong parent on the child benefit form, according to a recent FOI on HMRC from Royal London.
In these cases, there is a non-earner (or very low earner) who could benefit from the credit but is not doing so because the child benefit is in the name of their partner.
If this applies to you, all you have to do is complete a CF411A form on Gov.uk.
Video: how child benefit works
To find out more about how child benefit works and what you need to know if your salary is over £50,000, check out our short video below.
4) Top up your state pension
If you’ve taken time out of work to care for your family in the past but didn’t claim National Insurance credits it’s also possible to top up your state pension by making Voluntary ‘Class 3’ National Insurance Contributions.
These payments help to fill any gaps in your National Insurance record.
The current Class 3 rate for the 2019-20 tax year is £15 a week.
Usually, you can only pay gaps in your record from the past six years, but depending on your age, you may be able to fill gaps from even further back.
The deadline to pay is 5 April each year. For further details on how and when to pay, check Gov.uk.
You can contact the Future Pensions Centre on 0800 731 0175 for more information on the impact of paying shortfalls in your National Insurance record before you commit to making payments.
For more tips and advice, check out our comprehensive state pension guide.