Specified Adult Childcare Credits

Specified Adult Childcare Credits
(SACC)

These credits are only available from April 2011 and you must make an application to receive the National Insurance adult childcare credits. Also, they can be used to increase or sometimes completely enable entitlement to the state pension. They emerge where the child’s parent or main carer doesn’t need the NI credits appearing from their claim to child benefit.

What does a successful SACC claim achieve?

Basically, to be entitled to a full state pension you need 35 years of national insurance contributions (NI). For each tax year an eligible individual successfully applies for SACC then only it could count as a relevant year for state pension purposes.

Every year claimed under SACC an individual’s state pension could increase by £275 per annum (based upon 2022/23 state pension figures). For e.g., a SACC claim covering 10 years could result in an extra £2,750 of state pension per year (based upon 2022/23 state pension figures).

Who is an eligible individual?

A family member, aged 16 or over, who looks after a relative under the age of 12.

Who is deemed to be a family member?

1) Mother or father who does not live with the child (‘non-resident parent’)
2) Grandparent, great-grandparent or great-great-grandparent
3) Brother or sister
4) Aunt or uncle
5) Husband or wife or former husband or wife of anyone in above points 1 to 4
6) Civil partner or former civil partner of anyone in above points 1 to 4
7) Partner or former partner of anyone in above points 1 to 6
8) Son or daughter of anyone in above points 5 to 7
9) In respect of the son or daughter of anyone in above point 4, that person’s:

• Husband or wife or former husband or wife
• Civil partner or former civil partner, or
• Partner or former partner

For above points 3 (in relation to the child) and for 4 (in relation to the parent) include:

• A half-brother or half-sister
• Step-brother or step-sister
• An adopted brother or an adopted sister

For above point 7, a partner is the other member of a couple consisting of:

• A man and woman who are not married to each other but live together as husband and wife, or
• Two people of the same sex who are not civil partners of each other but are living together as if they were civil partners.

What are the conditions that need to be met?

1. The relative:

• Has not reached state retirement age.
• Looks after a child/children under the age of 12 whilst the child’s parent or main carer is working.
• He/she does not already count the year as a qualifying year for state pension purposes in their own right, through their own contributions or NI credits.
• He/she is ordinarily resident in the UK.

2. The parent (or carer) has registered to claim for Child Benefit but does not need the NI credit from the Child Benefit claim for their own state pension purposes.
3. Both the relative and the parent make a joint election, after the tax year has gone, to transfer the Child Benefit NI credit to the relative.
4.  There is no minimum requirement for the number of hours of care provided.
5.  You will not be able to claim if you made a valid election to pay reduced NI in the past and that election is still in place.

Why would a parent/carer transfer their NI credit to the relative?

a) They may have been earning sufficient income for that year for it to count as a relevant year for state pension in their own right.
b) They may already have made 35 years of NI contributions; therefore, they are entitled to a full state pension.
c) To help enhance the state pension provision for the relative.

How many tax years can you go back and make a claim?

Assuming you meet the qualifying conditions then you can claim from the 2011/12 tax year up to and including the 2021/22 tax year. However, with respect to the 2022/23 tax year onwards, you can only make a claim after the end of the particular tax year.

How does the relative make the claim?

1. You must complete form CA9176.
2. The parent/carer who has registered for Child Benefit must countersign this form.
3. If you are the spouse, civil partner or partner of the current person registered for Child Benefit for the child being cared for, and you want to transfer entitlement to the NI credits to yourself then you must complete form CF411A.

Helpful information

• If you look after 2 or more children from the same family, then you can only claim one NI credit.
• If two or more relatives are looking after the same child, only one of you can claim the NI credit therefore, you will need to decide who is making the SACC claim.
• If there are two or more relatives looking after two or more children from separate families then each of you can make a SACC claim. One relative for one different child.
• You can still make an application for SACC in respect of the Covid years (2020/21 and 2021/22) if you have provided care in a different way, for e.g., over the telephone or video

Tip

1. If the parent/carer has not claimed for Child Benefit for fear of incurring the high-income child benefit charge, then you cannot, at present, make a SACC claim.

2. However, encourage the parent/carer to register for Child Benefit but opt to not receive it.

3. The registration will potentially enable you to apply for SACC, covering the period from 3 months prior to the registration onwards.

If you wish to discuss the Specified Adult Childcare Credits or other issues then please do contact us.

You can read more about this in our Pay Less Tax Charity special article.

We also have an article on “How to save corporation tax in the UK”.