What are National Insurance credits and who can claim them?

National Insurance credits are a useful means of plugging any gaps in your National Insurance record to ensure you receive certain benefits, most notably the State Pension. Depending on your circumstances, you may be eligible to claim for NI credits. Here, Acumen explains what National Insurance credits are, who can claim, and how we can help.

What are National Insurance credits?

National Insurance credits can help fill any gaps you may have in your National Insurance record to ensure you qualify for certain benefits, including the State Pension. You may be eligible to receive National Insurance credits if you’re not paying National Insurance. For instance, if you’re currently claiming benefits because you’re ill or unemployed. You can check your eligibility on the GOV.UK website.

Who can claim National Insurance credits?

Depending on your eligibility, you’ll either receive National Insurance credits automatically or you’ll have to apply for them. These will either be Class 1 credits that count towards your State Pension and may help you qualify for some other benefits, such as contribution-based Jobseeker’s Allowance. Otherwise, they will be Class 3 credits that only count towards your State Pension.

You can’t usually get credits if you’re:

• A married woman paying reduced rate National Insurance
• Self-employed and need to pay Class 2 National Insurance

Let’s take a closer look at some of the main criteria that can make you eligible for receiving NI credits.

National Insurance credits for grandparents

Specified Adult Childcare credits were introduced in April 2011 for grandparents, and other family members, who care for a child under 12 while their parent or main carer is working. This type of credit transfers the National Insurance credit attached to Child Benefit from the recipient to the family member. Crucially, there is only a credit for each Child Benefit recipient, not for each child under 12 who is cared for.

So how does that work in practice? Well, if two grandparents are caring for their daughter’s two children, there is only one credit available for transfer. In which case, the Child Benefit recipient (the parent or carer) must decide who should have the credit. However, if the grandparents are caring for their daughter’s child and their son’s child, that means there are two Child Benefit recipients and therefore two credits available for transfer.

National Insurance credits for carers

If you care for someone for at least 20 hours a week, you could be eligible for Carer’s Credit, which is a National Insurance credit that helps with gaps in your National Insurance record. To receive Carer’s Credit you must be aged 16 or over, under State Pension age, and looking after one or more people for at least 20 hours a week. The person you’re looking after must get one of the following:

• Disability Living Allowance
• Attendance Allowance
• Constant Attendance Allowance
• Personal Independence Payment
• Armed Forces Independence Payment

If the person you’re caring for does not receive one of these benefits, you may still be able to get Carer’s Credit. When you apply, simply fill in the ‘Care Certificate’ part of the application form and get a health or social care professional to sign it. It’s also worth mentioning that carers who do not necessarily qualify for Carer’s Allowance may otherwise be eligible to receive Carer’s Credit.

National Insurance credits and child benefit

If your child is under 12 and you’re not working or don’t earn enough to pay National Insurance contributions, even if the total household income is high, claiming Child Benefit can give you National Insurance credits that count towards your State Pension and fill in any gaps in your record. 

If you’re a parent registered for Child Benefit for a child under 12, you’ll receive Class 3 credits automatically. If you’re a foster carer, or a kinship carer in Scotland, you’ll need to apply for Class 3 credits. You can also apply to transfer Class 3 credits from one spouse or partner who receives Child Benefit to another.

Advice about National Insurance credits

If you need any advice or assistance about claiming National Insurance credits, our experienced team of financial planners will be only too happy to offer you tailored advice and guidance based on the best course of action for your financial situation. We can ensure you get the best from your retirement.

Acumen has a 21-strong team, including 10 financial advisers, with more than 150 years of collective experience to their name. We offer impartial financial planning advice to individuals and companies right across the North West and further afield. Our highly qualified and experienced multi-disciplinary team works together to provide a thoroughly tailored and joined up approach to financial planning.

For more information about our financial planning services, or to speak to one of our advisers, please contact Acumen today by calling 0151 520 4353 or email us at [email protected].