The Pension Credit is a tax-free benefit intended to help low-income retirees. The payout could allow those who qualify to win thousands more each year. But how much exactly can you have in savings before it affects your pension credit?
What is the pension credit?
The pension credit is an income-tested, means-tested benefit for people over the age of 65 for retirement, and will rise to 66 in October.
This payment gives the elderly a weekly supplement to their income which can be paid every two weeks or every four weeks.
The pension credit is available to single retirees and couples and is available to over three million UK households according to the government.
However, in many cases people do not realize that they are entitled to claim a pension credit.
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How much can you have in savings before it affects your pension credit?
All labor income is treated as normal.
But when it comes to saving and investing, it is treated differently.
The first £ 10,000 of your savings does not count and will not affect your pension credit.
For amounts over £ 10,000, it is assumed that you earn £ 1 per week for £ 500 of savings and investment, which equates to 10.4% interest.
How to claim the pension credit?
The easiest way to apply for a pension credit is over the phone.
A friend or family member can call for you, but you should be with them when they call you.
The pension credit application line is available at the following address:
- Telephone: 0800 99 1234
- Text phone: 0800 169 0133
- NGT Text Relay (if you cannot hear or speak on the phone): 18001 then 0800 99 1234
- The telephone lines are open Monday to Friday from 8 a.m. to 7:30 p.m.
You can use a claim using a paper claim if you cannot make a claim over the phone.
You can also contact a volunteer organization, for example, Citizens Advice or AgeUK, in your area or have a friend or family member call the helpline to request a paper request.
When making your claim, you will need your:
- national insurance number
- Information on your income, savings and investments
- Bank account details.
The earliest you can start your application is four months before you reach state retirement age.
You can apply any time after reaching retirement age, but your application can only be backdated for three months.