Latest news with #WinterFuelPayments
Daily Mirror
11 hours ago
- Business
- Daily Mirror
Millionaires may be eligible for Winter Fuel Payments in new rules
The Winter Fuel Payment U-turn could open up an unexpected loophole for wealthy retirees After facing severe backlash for cutting back Winter Fuel Payments shortly after winning the election last year, the Labour party has made a U-turn. Announcing new rules to means-test the seasonal benefit to assure vulnerable retirees are helped through the harshest months. To be eligible for the Winter Fuel Payment, which offers either £200 or £300 every winter to help cover heating costs, people over state pension age will need to have a taxable income of under £35,000 per year. Experts at Forbes Dawson warned: 'Although this may seem like a sensible approach, as many pensioners are asset-rich but have relatively low levels of income this could have unintended consequences and exclude many 'poor' people. 'Wealthy pensioners are generally in a unique position to control their level of taxable income on a year-to-year basis. Most pensioners will generally have some control over the amount of taxable income they extract from their pensions on an annual basis and many pensioners will have no 'income' and live off their built-up capital.' However, the experts added: 'We are not seriously suggesting that wealthy individuals will manipulate their income just to enjoy a £200 benefit, there will be cases where the very wealthy still qualify, while more deserving cases go without.' To break it down, the finance experts shared a fictional example of a retired NHS consultant called Dr Sam who has an estate worth £5million and makes specific moves with his money already in order to cut down a future Inheritance Tax bill. Including making loans to his Family Investment Company that sits outside his estate. As none of the shares are held by him directly, he doesn't pay tax on it and instead gets £200,000 annually as a repayment on his loan to the company. So while his general income is sitting at six-figures, his taxable income is zero so he will qualify under the new Winter Fuel Payment rules. In another fictional example, the money experts pointed out how people with less assets in retirement don't have as much control over their finances and might be excluded from the benefit. Retired teacher Doris uses a defined benefit public sector pension which is taxable income. She gets £40,000 a year from it, roughly £2,600 after tax, and with little money elsewhere she is reliant on nearly every penny so she can't cut it down. Because of her taxable income, she will not qualify for the benefit despite getting £160,000 less each year than Dr Sam. The new rules will make nine million more pensioners eligible for Winter Fuel Payments. And people can still opt out of receiving it but will need to do so before 15 September, 2025. Eligible people over state pension age will be receiving £200 between November and December 2025. Meanwhile those over the age of 80 who are eligible will receive £300.
Wales Online
3 days ago
- Business
- Wales Online
Full list of who is eligible for up to £305 in cash support from DWP this year
Full list of who is eligible for up to £305 in cash support from DWP this year The DWP will make these winter payments automatically, with no need for anybody to claim them. People of a certain age and with a specific income will receive cash support for winter bills (Image: Getty ) Millions of Britons are set to receive a financial boost this winter, with up to £305 on offer from the Department for Work and Pensions (DWP). Those eligible include individuals of a certain age group and with particular income levels. For the 2025/26 Winter Fuel Payment, the DWP has confirmed that the qualifying week will be 15-21 September, automatically benefitting those born on or before 22 September, 1959 residing in England and Wales. An estimated nine million pensioners could be in line for payments ranging from £200 to £300, aimed at easing the pressure of soaring energy costs during the colder season. Designed to aid older folk with an income under £35,000 annually, the payment is nevertheless available to higher earners – who have the option to decline the amount or reimburse it via their Self-Assessment tax return through HM Revenue and Customs (HMRC). There's no need for any applications; as these payments will be made automatically. As reported by the Daily Record, Scottish pensioners are set to enjoy similar benefits due to policy alterations; despite Scotland replacing the Winter Fuel Payments with the Pension Age Winter Heating Payment, they won't miss out on support. Specifically, First Minister John Swinney reassured on Monday that Scots would not receive anything less than their entitlements under the current UK Government's scheme. Details about the adjustments to the Winter Fuel Payment are expected soon, with assurances from Swinney that "the Scottish Government will always seek what is best for Scotland's pensioners". The Scottish administration has pledged to give every one of Scotland's 1.1 million retirees at least £100 on St Andrew's Day, November 30. Specifically, individuals aged 66-79 claiming eligible means-tested benefits, such as Pension Credit, will get £203.40, while those aged 80+ on the same benefits will get £305.10. Now, all pensioner households seem likely to receive a minimum of £200. Meanwhile, the DWP has issued a warning to the elderly community to beware of potential scams. They were told to be vigilant against con artists using fake winter heating payment messages, via texts, emails, and social media. Article continues below A clear warning was issued: "If you receive a text about 'Winter Fuel Payment' it is a scam. Winter Fuel Payments are made automatically, you do not need to do anything." As we await the full details on this year's Winter Fuel Payment expected by the end of June, here's an outline of what we know regarding eligibility. Eligibility To receive the Winter Fuel Payment, you must be of State Pension age during the specified week - the third week of September. For 2025/26, that means the week of 15-21 September 2025. Therefore, to qualify, you must have been born on or before 22 September 1959. Winter Fuel Payments are set at £200 per household for those aged between 66 and 79, or £300 per household where someone is aged 80 or over. Shared payments are received by pensioners not on an income-related benefit such as Pension Credit. For pensioners with an income exceeding £35,000 The payment will be reclaimed from individuals via HMRC based on their individual taxable incomes. For the majority, it will be recovered through PAYE, or in their Self-Assessment tax return for those who file and pay their taxes in this way. Article continues below The recovery process will be made as simple as possible with clear guidance provided for taxpayers. For those who wish to opt out of receiving the Winter Fuel Payment, DWP will create a simple system to allow them to do so, eliminating the need for HMRC to reclaim the payment. Further details on this will be announced this month. For additional information, visit
Wales Online
3 days ago
- Business
- Wales Online
People with 'modest' savings could miss out on £300 DWP Winter Fuel Payment under new rules
People with 'modest' savings could miss out on £300 DWP Winter Fuel Payment under new rules The Department for Work and Pensions is set to deny thousands the support with experts warning of several factors you should be aware of State pensioners could lose out on £300 Winter Fuel Payments from the Department for Work and Pensions due to having "modest" savings (Image: WalesOnline/Rob Browne ) State pensioners could lose out on £300 Winter Fuel Payments from the Department for Work and Pensions due to having "modest" savings. Following a recently-announced Labour Party government reversal, DWP Winter Fuel Allowances will be sent out to nine million pensioners later this year. However, Coventry Building Society has issued a warning that numerous state pensioners might inadvertently surpass the new £35,000 limit. For the best money-saving tips straight to your inbox, sign up to our Money newsletter here Interest accrued on standard savings accounts is deemed taxable income and contributes towards the threshold, even if it's within the Personal Savings Allowance and remains untaxed. For individuals nearing the £35,000 threshold already, additional income from savings could tip them over the edge. Jeremy Cox, head of Strategy at Coventry Building Society, cautioned that "thousands could still unknowingly be left out in the cold - not because they're earning more, but because their savings are." He pointed out that "many pensioners may not realise that interest earned on savings held outside of ISAs count towards their total taxable income." Article continues below He added: "With interest rates still relatively high, even modest savings can generate income that pushes someone over the threshold," reports Birmingham Live. He advised: "ISAs offer a tax-free way to keep savings interest out of the income equation. Interest earned within an ISA is never taxed and does not count toward income calculations". Financial advisers speaking to The Telegraph emphasised that those slightly above the £35,000 threshold could engage in minor behavioural tweaks to enjoy a financial uplift this coming winter. Alice Haine, from investment service Bestinvest, referred to the updated limit, saying: "It's effectively another tax cliff-edge." "Paying attention to what constitutes as income may become very important for those whose incomes hover around the £35,000 mark, as a minor adjustment could be the difference between receiving the payment or handing it back through tax," Ms Haine said. Sir Steve Webb, ex-pensions minister and partner at pension consultancy LCP, said: "The Government's own figures clearly suggest that they expect the number of losers from the new policy to rise each year. Article continues below "With around two million pensioners currently over the £35,000 threshold, this number could easily rise by another half a million by 2030. "This could end up being another way in which governments use inflation to quietly raise additional revenue year-by-year."
Daily Mirror
4 days ago
- Business
- Daily Mirror
Pensioners with just 'modest savings' to be denied £300 Winter Fuel Payment
A alert has been issued for nine million state pensioners who could still lose £300 Winter Fuel Payments from the Department for Work and Pensions - experts have explained all Thousands of state pensioners may be at risk of losing their £300 Winter Fuel Payments from the Department for Work and Pensions due to having "modest" savings, a building society has warned. Following a government U-turn, the Winter Fuel Allowances have been reinstated for nine million pensioners, However, those unknowingly exceeding the new £35,000 threshold may still miss out. Coventry Building Society is warning that interest earned on standard savings accounts counts towards the threshold, which could push people already close to the limit over the edge. Jeremy Cox, head of strategy at Coventry Building Society, warned that "thousands could still unknowingly be left out in the cold - not because they're earning more, but because their savings are". He explained that "many pensioners may not realise that interest earned on savings held outside of ISAs count towards their total taxable income". He added: "With interest rates still relatively high, even modest savings can generate income that pushes someone over the threshold." He noted: "ISAs offer a tax-free way to keep savings interest out of the income equation. Interest earned within an ISA is never taxed and does not count toward income calculations". Financial planners have informed The Telegraph that those marginally above the £35,000 limit could benefit from slight alterations in behaviour, potentially providing them with an extra bit of cash this winter, reports Birmingham Live. Alice Haine from Bestinvest referred to the new threshold as "is effectively another tax cliff-edge". She stressed: "Paying attention to what constitutes as income may become very important for those whose incomes hover around the £35,000 mark, as a minor adjustment could be the difference between receiving the payment or handing it back through tax." Sir Steve Webb, the former pensions minister now with pension consultants LCP, made it clear: "The Government's own figures clearly suggest that they expect the number of losers from the new policy to rise each year." He warned: "With around two million pensioners currently over the £35,000 threshold, this number could easily rise by another half a million by 2030." Sir Steve raised concerns about a potential covert fiscal tactic, concluding with: "This could end up being another way in which governments use inflation to quietly raise additional revenue year-by-year."
Daily Mirror
4 days ago
- Business
- Daily Mirror
HMRC will change tax code of state pensioners to reclaim cash
Winter Fuel Payments will be paid to all pensioners, but if you earn more than £35,000 a year, then you will have to pay it back HMRC will automatically change the tax codes of pensioners earning more than £35,000 a year to recover Winter Fuel Payments. It has been confirmed that thousands more people over state pension age will receive the cash help this winter after a U-turn was announced by the Government. Winter Fuel Payments will be paid to all pensioners, but if you earn more than £35,000 a year, then you will have to pay it back. This will be done either by PAYE - which will involve adjusting your tax code - or through self-assessment. HMRC has said no one will need to register for self-assessment unless they already need to do so for other reasons. You will also be able to opt out of receiving the payment, with details of how to do this yet to be confirmed. HMRC confirmed: "Winter Fuel Payments will be paid automatically without a claim, and any charges will be collected via PAYE, or via self-assessment for those with other income to declare." Winter Fuel Payments will still be issued per household, but the income eligibility is based per person. For example, if you have two people living together and one earns £30,000 a year and the other earns £40,000, one person would keep their share of the Winter Fuel Payment but the other would pay it back. Winter Fuel Payments are worth £200 for eligible households, or £300 for eligible households with someone aged over 80. Your eligibility will be based on your age by the end of the qualifying week. The qualifying week changes every year, but for winter 2025/26, the qualifying week will be September 15 to September 21, 2025. Under current rules that were introduced last year, Winter Fuel Payments are only available to pensioners who are claiming means-tested benefits, such as Pension Credit. In winter 2023/24, they were available to everyone over state pension age. The update will cost around £1.25billion in England and Wales and will save around £450million. In Scotland, the Winter Fuel Payment has been replaced with a new Pension Age Winter Heating Payment. Rachel Reeves said: 'Targeting Winter Fuel Payments was a tough decision, but the right decision because of the inheritance we had been left by the previous government. 'It is also right that we continue to means-test this payment so that it is targeted and fair, rather than restoring eligibility to everyone including the wealthiest. 'But we have now acted to expand the eligibility of the Winter Fuel Payment so no pensioner on a lower income will miss out. This will mean over three quarters of pensioners receiving the payment in England and Wales later this winter.'
