As children return to school, grandparents helping with drop-offs, pick-ups and after-school care are being urged to check whether they can claim a little-known National Insurance credit.
Quick answer: Grandparents below State Pension age who care for a grandchild under 12 may be able to claim Specified Adult Childcare National Insurance credits. A full qualifying year could add around £359 a year to someone’s State Pension at current rates, although the actual benefit depends on their National Insurance record.
The new school term does not just mean fresh uniforms, packed lunches and an alarming number of missing PE socks.
For many families, it also means grandparents stepping in to cover school runs, after-school care and the awkward gap between the final bell and the end of the working day.
This support can save parents hundreds or even thousands of pounds in childcare costs. However, grandparents may be able to get something valuable in return, particularly if helping the family has left gaps in their National Insurance record.
Before September arrives, families should check the financial support available, agree how the school-run arrangement will work and make sure everyone understands the rules.
Getting ready for September? Read our complete back-to-school money guide, including practical help for parents worried about the cost of the new term.
The little-known pension boost for grandparents
Grandparents who look after a grandchild under 12 may be able to claim Specified Adult Childcare National Insurance credits.
These are not a cash payment and grandparents are not paid directly for doing the school run. Instead, the credits can fill gaps in their National Insurance record and potentially increase the State Pension they eventually receive.
The credits can be particularly useful for a grandparent who:
- Has reduced their working hours to provide childcare
- Has temporarily stopped working
- Earns too little to pay National Insurance
- Has gaps in their National Insurance record
- Is not already receiving another qualifying National Insurance credit
You do not have to provide full-time childcare. Regular school runs, after-school care or helping during school holidays may count. HMRC says a Class 3 credit can be awarded for each week, or part of a week, in which eligible care was provided.
Who can claim grandparents’ childcare credits?
A grandparent or another eligible family member can apply if:
- They cared for a related child under the age of 12
- They were aged 16 or over but below State Pension age when the care was provided
- They were ordinarily resident in the UK, excluding the Channel Islands and Isle of Man
- The child’s parent or main carer claimed Child Benefit
- The parent did not need the attached National Insurance credit themselves
- The parent agrees to the credit being transferred
The scheme is not limited to grandparents. Other eligible relatives can include great-grandparents, adult siblings, aunts, uncles and certain relatives of the parent’s spouse or partner.
How could one year be worth around £359?
The full new State Pension is £241.30 a week in the 2026/27 tax year. Under the new State Pension system, one additional qualifying year will commonly add around one thirty-fifth of the full rate.
That is approximately £6.89 a week, or just over £358 a year. Over a retirement lasting 20 years, that could add up to more than £7,000 before future State Pension increases are considered.
However, this is not a guaranteed payment. The amount will depend on the grandparent’s individual National Insurance history, whether they were contracted out in the past and whether they are already on track to receive the full State Pension.
Check before claiming: Grandparents can use the government’s free State Pension forecast service to see their National Insurance history and whether filling a gap could improve their pension.
How are the credits transferred?
A parent claiming Child Benefit for a child under 12 normally receives an automatic National Insurance credit.
If the parent already builds a qualifying year through their own job or self-employment, they may not need that credit. It can potentially be transferred to the grandparent or another eligible relative who provided childcare so that the credit is not wasted.
The parent or main carer must agree to the transfer and provide their details on the application.
There is only one credit available for each Child Benefit claim, not one credit for every child. If two grandparents share the childcare, the parent will generally have to decide who should receive it.
However, if the grandparents care for grandchildren belonging to two different adult children, there may be two Child Benefit recipients and therefore two separate credits available.
When can grandparents apply?
Families must wait until 31 October after the end of the relevant tax year before applying. This allows HMRC to check whether the parent has already built a qualifying National Insurance year and can transfer the childcare credit.
For example, applications relating to care provided during the 2025/26 tax year can be made from 31 October 2026.
Claims may also be made retrospectively for eligible childcare provided as far back as 6 April 2011. Grandparents whose grandchildren are now teenagers may therefore still be able to fill old gaps in their National Insurance record.
Families can check the full rules and download the relevant form through the government’s Specified Adult Childcare credits service.
Important: The parent should not transfer the credit if they need it to complete their own National Insurance year. Both the parent and grandparent should check their records first.
Can parents pay a grandparent for childcare?
Parents can make a private arrangement with a grandparent and may choose to cover petrol, food, days out or other expenses. They can also agree to pay the grandparent for their time.
However, regular payments could count as taxable income. If a grandparent is being paid frequently, they should keep a record of what they receive and what they spend providing the childcare.
They may also need to tell HMRC if the arrangement becomes regular paid work or if their relevant trading income exceeds the tax-free trading allowance.
Additional earnings could affect means-tested support such as Universal Credit, Housing Benefit or Pension Credit, so grandparents receiving benefits should check before agreeing to regular payment.
Can Tax-Free Childcare be used to pay grandparents?
Parents cannot normally use Tax-Free Childcare to pay for an informal arrangement with a grandparent.
In England and Scotland, Tax-Free Childcare may generally be used to pay a relative only when that relative is a registered childminder and looks after the child somewhere other than the child’s own home.
A similar rule applies in Wales. Northern Ireland has its own childcare approval requirements and additional conditions can apply when the childcare provider is related to the child.
Informal care provided by a grandparent also does not qualify for England’s Free Childcare for Working Parents scheme.
Parents should use the government’s childcare support checker before attempting to claim Tax-Free Childcare or Universal Credit childcare costs for care provided by a relative.
Do grandparents need to register as childminders?
A grandparent looking after their own grandchildren under a private family arrangement will not normally need to register as a childminder.
The position can change if they begin looking after unrelated children for payment or start operating a wider childcare business. Registration requirements differ across England, Scotland, Wales and Northern Ireland.
Anyone planning to turn a family arrangement into paid childcare work should check the rules with their local authority or childcare regulator.
Do grandparents have parental responsibility?
Regularly looking after a grandchild does not automatically give a grandparent parental responsibility.
Parental responsibility includes important legal powers and duties, such as making decisions about a child’s education, consenting to medical treatment and applying for a passport.
A formal legal arrangement will not normally be needed for occasional school runs or after-school care. However, parents should give the school permission to release the child to the grandparent.
Schools may use collection lists, passwords or identification checks. Families should update these details before the first day of term rather than waiting until the first collection.
Grandparents must follow the car seat law
The driver is legally responsible for making sure a child under 14 is using the correct restraint.
Children must normally use an appropriate child car seat until they are either 12 years old or 135cm tall, whichever happens first. After that, they must use an adult seat belt.
A seat that fits correctly in a parent’s car may not be suitable for the grandparent’s vehicle. It should be checked and fitted before the first school run.
The full requirements and limited exceptions are set out in the government’s child car seat guidance.
Still buying uniform?
Before paying full price, see our updated guide to the cheapest school uniforms in the UK. It includes £5 supermarket bundles, second-hand options and ways to find free uniform locally.
What if the grandchild lives with the grandparent?
Grandparents who are bringing up a grandchild, rather than simply helping with childcare, may qualify for more substantial financial support.
Depending on the family’s circumstances, this could include:
- Child Benefit
- The child element of Universal Credit
- Council Tax support
- Disability benefits for the child
- Carer’s Allowance or Carer Support Payment
- Local authority kinship care support
- Guardian’s Allowance in certain circumstances
Guardian’s Allowance is £22.95 a week in 2026/27 and is paid on top of Child Benefit. Eligibility is tightly defined, including circumstances where one or both parents have died.
Kinship care support varies depending on where the family lives, the child’s needs and whether the arrangement was made privately or through a local authority. Grandparents in this position should request a kinship care assessment and independent benefits advice.
Back-to-school checklist for grandparents
- Ask the school to add the grandparent to its approved collection list
- Share any collection password or identification requirements
- Fit and check the correct car seat
- Provide emergency contact numbers
- Write down details of allergies, medication and medical conditions
- Agree how petrol, food and other expenses will be covered
- Keep a simple record of the weeks in which childcare is provided
- Check whether Specified Adult Childcare credits could fill a pension gap
The MoneyMagpie verdict
Grandparents provide an enormous amount of unpaid childcare and often make it possible for parents to stay in work.
Specified Adult Childcare credits will not pay for the petrol, snacks or emergency stationery runs, but they could protect a grandparent’s National Insurance record and make a meaningful difference to their retirement income.
The important thing is to check. The credits are not awarded automatically, and families may be able to claim for eligible care provided in previous years.
Remember: These credits are designed to fill National Insurance gaps, not provide an immediate cash payment. Check both the parent’s and grandparent’s records before requesting a transfer.
Frequently asked questions
Can a grandparent claim for doing one school run a week?
Potentially, yes. HMRC states that eligible credits can be awarded for each week or part of a week in which care was provided. All the other eligibility conditions must still be met.
Are grandparents paid cash for looking after grandchildren?
There is no general government cash payment for informal grandparent childcare. Specified Adult Childcare credits protect the grandparent’s National Insurance record rather than providing money immediately.
Can grandparents claim after reaching State Pension age?
The grandparent must have been below State Pension age during the period when the childcare was provided. Someone who has since reached State Pension age may still be able to claim for an earlier eligible period.
How far back can grandparents claim childcare credits?
Eligible claims can potentially be made for childcare provided since 6 April 2011.
Can both grandparents claim for the same child?
Only one credit is available for each Child Benefit claim. If grandparents share the care, the Child Benefit recipient will normally need to decide who receives the available credit.
This article provides general information and does not constitute legal, tax, pension or financial advice. Childcare and kinship care rules can differ across the UK and according to individual circumstances. Rates and rules checked on 25 August 2026.
