Tens of thousands of parents missing out on thousands of pounds due to child benefit complications
Complicated child benefit system means parents miss out on thousands of pounds in state pension - here's how to make sure you get what you're owed
OVER half a million parents are missing out on vital state pensions benefits.
This is due to flaws in the system which means that if you fail to claim child credit you won't get national insurance credits either.
Missing out on just one month's worth of NI credits, could lose you £5,000 from the total value of your state pension.
Figures from HMRC suggest that tens of thousands of mothers with young children have already permanently reduced their state pension because of the changes to how child benefit is run, which came into force in 2012.
The number of families receiving child benefit in 2017 was 7.38 million compared with 7.92 million before the rules changed.
Some stay at home parents will have lost over £23,000 in state pension rights already and will not be allowed to make a backdated claim for most of the missing credits.
If I've missed payments, can I claim them back?
Child benefit claims can only be back-dated by three months. This means that families that fail to fill in forms on time are missing out.
For families on the breadline, the missing child benefit payments could make a real difference. A family with three children that missed out on just one month’s worth of payments would have lost over £190. If the same family missed three months' payments they would have lost around £625.
But, it’s not just the child benefit payments that are at risk. Parents who fail to fill in forms on time will also miss out on state pension tax credits, which can lead to gaps in National Insurance records. These can only be back dated by three months too.
This means parents who've failed to claim will find they’re not eligible for the full state pension when they retire.
How to make sure you get National Insurance credits
MAKE sure you're claiming child benefit, even if one or both parents earns more than £50,000.
You can choose not to get Child Benefit payments, but you should still fill in the claim form. This will make sure you get National Insurance credits, which count towards your State Pension.
Claiming Child Benefit also means your child will get their National Insurance number automatically shortly before they’re 16. They won’t have to apply for one themselves.
You don’t have to take the child benefit cash and then pay it back as tax. Instead you can tick a box on the application to apply for a ‘zero rate’ of child benefit.
Royal London is campaigning for HMRC to relax the rules on back dated claims to ensure that stay at home parents do not miss out on pensions entitlements.
Steve Webb, Director of Policy at Royal London said: “It is shocking that tens of thousands of mothers have lost out on this vital protection since the Child Benefit changes in 2012. HMRC could fix this problem if it wanted to.
"They should allow people to make backdated claims to child benefit. And they should check their records against the birth registers to find out who is missing out and contact them. There is no excuse for penalising mothers for taking time out of paid work to look after children.”
What are am I entitled to?
You get Child Benefit if you’re responsible for one or more children under the age of 16.
There's no limit to the number of children you can claim child benefits for. However, if you claim Universal Credit, your benefits may be limited to your first two children, if any other children were born after 6th April 2017.
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You may have to pay a tax charge if either you or your partner earns more than £50,000.
To find out if you qualify, use the government's
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