The state pension can be a payment which people rely on as part of their income during their later years. In order to claim the new state pension, an individual is required to have a minimum of 10 qualifying years on this record – although these do not need to be in a row. This means that for 10 years at least, a persons was either working and paying National Insurance contributions, paying Voluntary National Insurance contributions, or getting National Insurance credits. The latter may be available for a number of reasons – such as one was unemployed, ill, or a parent or carer.

Should a person take time out of paid work in order to care for a young child, they can still get the National Insurance credits.

This can be achieved by being registered for Child Benefit payments for a child under 12.

For those who were or are in this situation after April 6 2010, Class Three credits are automatically applied, even if one does not receive it, the government says.

Some parents will opt against claiming Child Benefit if they or their partner have an individual income of more than £50,000 per year.

Should one or one’s partner have an individual income of more than £60,000 per year then a tax charge equal to the Child Benefit payment will apply.

If a person or their partner’s individual income is between £50,000 and £60,000 per year, then a tax charge of less than the Child Benefit payment will apply.

The government website warns that choosing to forego the payment doesn’t mean that the claim form shouldn’t be filled in.

The High Income Child Benefit Tax Charge page says: “You can choose not to get Child Benefit payments, but you should still fill in the Child Benefit claim form.

“This will help you get National Insurance credits which count towards your State Pension.”

Kay Ingram, Director of Public Policy at LEBC, told “In response to this change many couples have waived payment of child benefit but in doing so miss out on the credits for state pension which the stay at home parent is entitled to.

“Bizarrely the process for claiming the State pension credit is to fill out form CH2 which is the form for claiming Child Benefit.

“The claimant then ticks the box to waive payment of Child Benefit and then gets the state pension credit.”

Pensions expert Baroness Jeannie Drake was asked for her thoughts on the matter at a NOW:Pensions event, which saw Pensions Policy Institute introduce their report Facing an unequal future – closing the gender pensions gap.

Asked about the potential situation of foregoing Child Benefit for tax reasons resulting in some unpaid carers not claiming the National Insurance credits, she told “I think that’s very unfair.

“How it used to work if you were in pursuit of child benefit [is] you were automatically credited towards state pension benefits.

“Because women or families, lose their child benefit, the woman – who is usually the carer, sometimes it’ll be the man – has to actively say, ‘Well I’m not receiving Child Benefit but can I still have my credits for building up a state pension.’

“Of course, lots of them don’t understand the rules, they don’t do it, it’s human nature. I think that’s wrong.”

Baroness Drake instead suggested that HMRC could liaise with the DWP in order to address who should receive the credit by looking at the tax return.

“I fear that there’s going to be a group of women who for certain periods of their life, their partners money may have gone above £60,000, and the next year it might have gone down to £40,000, who will have lost the benefit of being credited because you know people lose paperwork in [urgencies] and so on.

“So I think that people should still be automatically credited, working with the HMRC.”

Last month, the national financial advisory firm LEBC Group called on the Women and Equalities committee regarding the closing of the Gender Pension Gap.

Ms Ingram said: “We believe that one of the key drivers of the Gender Pension Gap to be a lack of clarity in communications delivered to women around National Insurance credits and State Pension entitlement.

“Each year a NI contribution or credit is not claimed costs £250 per year of State Pension entitlement.

“That is why we are calling on the Committee to probe the quality of communication from the DWP and process around these issues.”

A Department for Work and Pensions spokesperson said: “The number of people receiving Specified Adult Childcare Credits has risen substantially since they were introduced in 2011, and we encourage everyone who might benefit to apply for the credits to which they’re entitled.

“Under the new State Pension, we expect that by 2030 more than three million women will be getting an average of around £550 more each year compared to the old system.

“Through automatic enrolment the proportion of women in the private sector without a workplace pension has been cut from 60 per cent in 2012 to 20 per cent in 2017.”

A spokesperson for HMRC told “To ensure no one misses out on their full state pension entitlement, HMRC has always encouraged families to claim Child Benefit, including households who might have to pay the High Income Child Benefit Charge (HICBC). 

“The Child Benefit claim form – which is included in Bounty Packs – has been redesigned for 2019 to stress the importance of this. However, we are continuously considering ways in which communications can be improved further, both at the birth of a child and for existing Child Benefit claimants.”

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