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In some circumstances you can be ‘credited’ with earnings or Class 3 contributions.
These ‘credits’ can help towards the contribution condition for a full State Pension by reducing the number of qualifying years you have to satisfy.
Credits for Unemployment or Incapacity for Work
You can be credited with earnings equal to the Lower Earnings Limit (£118 per week 2019 - 2020) for either each complete week you:
- Receive Job Seekers Allowance (JSA)
- Satisfy the qualifying conditions for JSA
- Were incapable of work or could be treated as incapable of work for Incapacity Benefit/Employment Support Allowance purposes
Credits for Caring Responsibilities
You will receive credits with earnings equal to the Lower Earnings Limit for each week in which you are:
- Caring for a child under 12 years of age for whom you receive child benefit
- A foster parent of a child under 12 years of age for whom you receive child benefit
- Looking after a sick or disabled person
Between 1978 and 6th April 2010, you may have received Home Responsibilities Protection (HRP) for the time you:
- Looked after a child for whom you were receiving child benefit
- Received Income Support for looking after a child or a sick or disabled adult
- Were in receipt of Carers Allowance.
HRP during this time will be converted into credits, up to a maximum of 22 years, for Retirement Pension purposes.
Both credits and HRP can help towards satisfying the contribution conditions for the full Old Basic State Pension and, from 2002-6th April 2016,also helped you to build up credits for Additional State Pension.
Credits will normally only be paid if you meet one or a combination of the following conditions for a whole tax year:
1. You receive Child Benefit for a child under age 12 (prior to 6th April 2010 this was 16 years of age).
If you are part of a couple, consider who should apply for Child Benefit to make sure that the person who needs their basic State Pension protecting most will get HRP.
2. You are a registered foster carer.
3. You look after someone for at least 35 hours a week and they are in receipt of:
- Attendance Allowance
- Constant Attendance Allowance
- Disability Living Allowance at the middle or highest rate care component (for at least 48 weeks of the year)
4. You have caring responsibilities for at least 20 hours or more per week for other people needing care. The person being cared for has to be certified as needing this care by a Health or Social Care professional.
It is possible for you to care for more than one person to meet the 20+ hour care requirement. It is also possible for more than one person to care for the same disabled person and both/all receive carer’s credits for doing so.
5. You receive Income Support (but not Carer’s Allowance) for being engaged in regular and substantive care for a severely disabled person.
Very important note:
You may qualify for weekly credits as a parent or carer and receive them automatically. However, in other instances you may have to apply and continue to do so each year.
To assure you are being credited, contact (via the NI Direct website):
- Pension Services
- HM Revenue and Customs
- Or the Pensions Advisory Service for independent advice