State Pension  

National adviser warns about missed childcare benefits

National adviser warns about missed childcare benefits

Working parents trying to organise childcare during the summer holidays often miss out on two government backed schemes, which could help them boost their pension and finances, national firm LEBC has said.

The first scheme is the Specified Childcare Credit, in which family members taking care of children may be eligible for a boost to their state pension, if they’re not working and are over 16 but under state pension age.

According to Kay Ingram, director of public policy at LEBC, this benefit can be claimed to top up the carer's national insurance credits for their state pension, helping them increase their entitlement to the maximum of £164.35 per week.

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To be eligible the child must be under age 12, and the working parent must be eligible to receive child benefit and be working and paying national insurance.

Those who have waived child benefit to avoid the tax payable, once earnings exceed £50,099, can also claim this credit by applying for child benefit but then waiving the payment of it.

Estimates from the Department for Work and Pensions (DWP) show 100,000 individuals are eligible for this benefit, but so far since 2011 a mere 19,000 have claimed.

Ms Ingram said claims can be backdated to 2011 and the form required, CA 9176, is available on the government's website.

The second benefit is the Tax Free Childcare scheme - which replaced childcare vouchers - in which for every £8 paid by the parent to clubs and organised activities or a registered childminder, the government tops this up to £10.

This is available to working parents in addition to 30 hours of free childcare. It is available for children under the age of 12, or under age 17, if disabled.

To be eligible both parents must be working and must each earn £125 per week or more. Those with earnings in excess of £100,000 from one parent, or the partner of a parent, are ineligible for this benefit.

According to LEBC, up to £10,000 per year can be paid in to a Tax Free Childcare account which means up to £2,000 per year is paid by the government, in quarterly instalments of up to £500.

It can be used to fund care and activities with nannies, child minders, schools and clubs which have registered under the government scheme.

Ms Ingram said there aren’t official numbers on the take up of this benefit, since the government "won’t know which parents are enrolling children in summer holiday activities".

However, the number of schools and clubs which have registered to be eligible for the scheme has increased, she added.