Brits urged to boost state pension by £342 a year with little-known benefit

Brits who've taken time out of work to look after family could be missing out on hundreds of pounds in retirement income every year. A Department for Work and Pensions (DWP) scheme known as Carer's Credit could help boost the state pension by up to £342 a year, but thousands of people are thought to be unaware it even exists.

The credit is designed to help unpaid or low-paid carers avoid gaps in their National Insurance (NI) record, which could otherwise reduce their pension payments later in life. To receive the full new state pension, currently worth £230.25 a week or £11,973 a year, people need to have built up 35 years of NI contributions.

You only earn National Insurance contributions through work if you're earning more than £12,570 a year, so those who've stopped working or reduced hours for caring responsibilities may fall short unless they receive credits.

Carer's Credit can step in to fill those missing years, potentially increasing the state pension by hundreds of pounds annually.

Over the course of a typical retirement, that could amount to more than £6,000 extra.

To qualify for Carer's Credit, you must be:

• Aged 16 or over
• Under state pension age (currently 66)
• Caring for someone for at least 20 hours a week

The person being cared for must also receive a qualifying benefit such as:

• Disability Living Allowance (middle or highest care rate)
• Attendance Allowance
• Personal Independence Payment (daily living part)
• Armed Forces Independence Payment
• Child Disability Payment (middle or highest care component)
• Adult Disability Payment (standard or enhanced daily living rate)
• Pension Age Disability Payment
• Constant Attendance Allowance
  

Even if the person doesn't get one of those benefits, it may still be possible to claim, but a Care Certificate must be filled in by a health or social care professional to support the application.

Some people automatically receive Carer's Credit, such as those already claiming Carer's Allowance, Carer Support Payment, or Child Benefit for a child under 12.

Foster carers may be eligible for National Insurance credits through a separate scheme.

To see whether you have any gaps in your NI record, you can check your State Pension forecast using the official government tool at gov.uk/check-state-pension, or via the HMRC app.

You'll need your Personal Tax Account login details, or you can register for an account on the GOV.UK website.

If eligible, you can apply for Carer's Credit by downloading the form at gov.uk/carers-credit or by calling the Carer's Allowance Unit on 0800 731 0297.

Once completed, the form should be sent to: Freepost DWP Carers Allowance Unit (You don't need to write anything else on the envelope - no stamp or postcode is needed.)

If your application is rejected and you believe it was wrong, you can ask for a mandatory reconsideration within a month of receiving the decision letter.

A full list of qualifying circumstances is available at gov.uk/national-insurance-credits/eligibility.