Around 850,000 eligible pensioners are missing out on Pension Credit, a vital financial support benefit that could provide up to £10,000 annually. This under-claimed means-tested benefit is administered by the Department for Work and Pensions (DWP) and is designed to help older Britons with low incomes.
Currently, an estimated £1.7 billion remains unclaimed every year, with many not taking advantage of the substantial financial assistance available. The Pension Credit can significantly increase a pensioner’s annual income, especially those living on the state pension.
What is Pension Credit and Who Qualifies?
Pension Credit is a means-tested benefit aimed at supporting pensioners on low incomes by boosting their retirement income. It is administered by the Department for Work and Pensions (DWP) and provides financial relief to older Britons who qualify. Despite its significance, many pensioners remain unaware of their eligibility, with £1.7 billion in potential benefits going unclaimed annually. By meeting specific income criteria, pensioners can access this program and enjoy additional support to manage everyday costs and improve their financial stability.
Pension Credit consists of two parts :
- Guarantee Credit : This ensures a minimum weekly income of £218.15 for single pensioners and £332.95 for couples.
- Savings Credit : Available to individuals who have saved toward their retirement, it provides additional financial support.
To qualify for Pension Credit, applicants must be over the state pension age of 66. Single individuals must have a weekly income below £201.05, and couples must earn less than £306.85 per week. However, even those with slightly higher incomes might still qualify, particularly if they have disabilities, caring responsibilities, or specific housing costs.
The application process is straightforward and can be done using the Government’s Online Calculator or by calling the Pension Credit helpline. Personal finance experts like Fiona Peake from Ocean Finance emphasize that many pensioners mistakenly assume they won’t qualify because of savings or a small private pension.
Other benefits available through Pension Credit
Pension Credit is known as a “gateway” benefit, opening access to other essential benefits. For instance:
- Council tax reductions: Claimants can save over £1,000 annually, depending on their local authority.
- Cold Weather Payment: A £25 payment for every seven-day period of freezing temperatures.
- Free NHS dental care and prescriptions: Potentially saving hundreds of pounds a year.
- Free TV licence for those over 75, saving £159 annually.
- Housing Benefit support: Financial help with rental costs.
Additionally, Pension Credit claimants are eligible for the Winter Fuel Payment, a support of up to £300 to help with energy bills. This, however, is now only available to those claiming Pension Credit, as it was mean-tested in recent changes by Chancellor Rachel Reeves.
The Importance of Applying in Today’s Climate
With the rising cost of living, particularly after the COVID-19 pandemic, older people have been hit hardest. Peake urges pensioners to apply for Pension Credit to alleviate the financial strain during this cost-of-living crisis. The increasing energy prices and stubborn food inflation make applying for all available support a smart move.
Key points to remember :
- Eligibility: Must be over 66 years old. Single pensioners must earn under £201.05 weekly, and couples under £306.85.
- Pension Credit is a gateway to additional benefits like Council Tax reductions, Cold Weather Payments, and free NHS services.
- Application: It’s easy to apply online or by calling the Pension Credit helpline.
- Don’t assume you won’t qualify—many pensioners are eligible, even with savings or small private pensions.
Pension Credit offers crucial support to older Britons, helping them secure a higher income. With millions of pounds going unclaimed, it’s worth exploring if you or someone you know could benefit from this program.
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Because women have to work the extra 6years to get pension they nearly all get full pension which puts them £2 over the pension credit limit that’s not even a loaf of bread and a pint of milk so they are on the poverty line.