The Department for Work and Pensions (DWP) has confirmed new Winter Fuel Payment regulations for pensioners living as couples, with crucial changes announced for the 2025 winter season.
The updated guidelines will ensure that more pensioners benefit from the fuel payment, following government changes aimed at addressing financial strain during the colder months. In a recent announcement, the DWP revealed that nine million pensioners across England and Wales would receive the Winter Fuel Payment.
After last year’s means-tested adjustments, the government has reversed the policy, ensuring that all eligible pensioners earning £35,000 or less will automatically receive a payment ranging from £200 to £300. For those whose income exceeds the £35,000 threshold, the payment will be reclaimed through the tax system.
Key Changes in the Winter Fuel Payment System
According to the DWP, this year’s Winter Fuel Payment will be issued to eligible households automatically, without the need for any additional applications.
For pensioner couples, the payment will be calculated on an individual basis, ensuring that each person is assessed according to their personal income rather than the combined household income. This is a significant shift from previous systems where the payment was based on household income.
Pensioners who earn over the £35,000 threshold will still receive the payment, but it will be deducted via the PAYE (Pay As You Earn) or self-assessment tax systems.
This adjustment means that couples with varying income levels may see different portions of the Winter Fuel Payment; for example, if one partner’s earnings surpass the £35,000 threshold, they would not keep their full share. However, the other partner may still benefit if their income is below the limit.
Additionally, if one of the pensioners is 80 years of age or older, they may receive a higher amount of £300, ensuring that senior citizens who may have greater energy needs are supported more substantially.
This individual payment approach has been praised by financial experts, such as Martin Lewis, who called it “a good system” compared to the previous, more complex means-testing system.
Pension Credit Claimants: A Special Case
There is one important exception to the new rules: pensioners who claim Pension Credit will receive their payment in a lump sum, without any splitting based on individual earnings. According to MoneySavingExpert, this means that couples who rely on Pension Credit will be unaffected by the new tax-based clawback system.
Additionally, they will not be required to pay back any of the Winter Fuel Payment, even if one partner exceeds the £35,000 threshold. This creates a straightforward and beneficial arrangement for those who are already receiving financial assistance through Pension Credit, ensuring they are not further burdened by additional deductions.