The taxman has warned MPs that 200,000 parents could be missing out on their future pension entitlement because their National Insurance contributions are not being made.
HMRC has written to the Treasury Select Committee warning that if child benefits are being claimed by the higher earner in a family then the partner could be missing out on National Insurance credits for themselves which means their qualification for their state pension will be reduced.
In their letter they admitted that they don’t have an accurate idea of how many people may be involved because they only keep information on the recipient of the benefit and not their partners, but they believe it to be around 3% of the total number of claimants.
Committee chairman Nicky Morgan said: “We have long-warned the government of the risk that for families with one earner and one non-earner, that if the sole-earner claims child benefit, the non-earner, with childcare commitments, forgoes National Insurance credits and, potentially therefore, their entitlement to a full future state pension.
“New figures today from HMRC show that over 200,000 parents may be in this situation, and therefore missing out on their pension.
“Now we have an idea of the scale of this problem, the government needs to pull its finger out and make sure people are aware of the issue and know how to put it right.”