New figures published Wednesday 28th February by HMRC suggest that tens of thousands of mothers with young children could face a permanently reduced state pension because of changes to the Child Benefit system introduced in 2013.
The new system means families where one earner earns over £60,000 they lose their entitlement to child benefit. Child benefit recipients (usually mothers) with a child under 12 get a National Insurance credit towards their state pension; this means that even if they are not in paid work, they are still treated as having contributed when it comes to claiming their state pension; families who are failing to register are not getting the benefit of the credit.
The workaround is that parents should still claim child benefit but elect not receive it to ensure that the non-working partner still has a full national insurance record.
Applications can be made here.