An investment firm has told grandparents how to apply for an underclaimed benefit.

Specified Adult Childcare Credits are given to grandparents when parents sign over their National Insurance contributions linked to Child Benefit to elderly relatives for looking after grandkids under 12 - as Mirror Online reports.

Savings company Hargreaves Lansdown estimate the benefit is worth up to £53,500 across a 20-year retirement.

READ MORE: DWP important update for everyone who claims carer's allowance

Figures estimate that out of the 100,000 people the government said were eligible to claim the benefit in 2018, only 19,000 had applied.

However, a tax and financial planning expert for investment firm Quilter believes even the 100,000 figure is vastly underestimated.

Shaun Moore said "It is fantastic to see more grandparents and other family members take advantage of Specified Adult Childcare Credits.

"However, the numbers of people benefitting from the credits still pales in comparison to the predicted number of people the scheme was intended to help. What’s more worrying is that such a significant proportion of applications are being rejected, which may put people off applying in the future."

A Freedom of Information request from Quilter showed that a fifth of applications for the benefit are rejected.

Over the past five years there have been almost 78,000 applications for the credits, but 16,000 were rejected. Around 15,580 people apply for the benefit every year, with only 12,385 of those being successful.

Quilter explained the major reasons Specified Adult Childcare Credit applications are rejected are because the applicant is still working, or gets other National Insurance credits.

The state pension you get in retirement is based on how many NI credits you’ve built up over your working life - so if you are claiming the full state pension you will not be eligible to apply.

You need at least ten years' worth of NI contributions to qualify for any sort of state pension, and at least 35 years to get the full amount, which is currently £179.60.

If an elderly relative doesn’t get the full amount, and spends a lot of time looking after grandchildren under the age of 12, it is possible to top up their state pension by allowing them to claim

Another major reason claims are rejected is if the grandparent receives Child Benefit for the child they are looking after. In this case the grandparent should get Specified Adult Childcare Credit automatically.

How to apply for Specified Adult Childcare Credits

You can apply by using the form CA9176 on the Gov.uk website.

Both you and the parent transferring the credit will need to sign the form, so you must be in agreement that you're happy to go ahead with the transfer.

You should also be aware that only one grandparent or family member can receive the credit - and the credit is per child benefit claimant, not per child.

You also must have been under the state pension age of 66 when you cared for the child in question.

The government will not take applications for any tax year until at least the following October.

Finally, the credits can be backdated to April 6, 2011, which is when the scheme came into effect.

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