After the government announced in summer that only pensioners receiving pension credit or certain other means-tested benefits would be entitled to the winter fuel payment, there was a rush in claims.
Regardless of the imperative, it is important to encourage our older clients to claim this benefit.
Only 65% of those entitled to pension credit received it in the financial year ending 2023, the Department for Work and Pensions has estimated. Therefore, more than one-third of people of state pension age are missing out on this cash benefit, as well as the concessions it can bring, including the winter fuel payment and health benefits.
Pension credit is a means-tested benefit. It can be paid on top of other income such as the state pension and private or occupational pensions.
Meeting minimum income
People may be able to claim it if they do not receive the amount deemed necessary to live on. Benefits should provide a minimum income guarantee; this is £218.15 for a single pensioner and £332.95 for a couple. Those whose income is below these levels can claim pension credit.
In addition, pensioners who are severely disabled or are a carer may get pension credit even if they have money coming in above minimum income guarantee levels.
That is because their pension credit assessment could find they are entitled to extra amounts through the severe disability addition and the carer addition. If a claimant is responsible for a child or young person, an additional amount(s) is included in the benefit calculation to recognise this.
The severe disability addition may be included in the benefit calculation if the claimant (and/or their partner) gets: attendance allowance; the daily living component of personal independence payment (PIP); the care component of disability living allowance (middle/highest rate); or, in Scotland, the daily living component of the adult disability payment.
It is worth noting that the general rule is that the disabled pensioner must be living alone to be entitled to the severe disability addition. However, there are complex exceptions to this rule, so it is best to seek advice from a benefits adviser.
The carer addition can be included for a carer who gets carer’s allowance or carer support payment in Scotland, or who has claimed carer’s allowance but cannot be paid it because they get the state pension. This is called an underlying entitlement to carer’s allowance.
This rule is important because the carer element can be included in the pension credit calculation only if the pensioner has made a claim for carer’s allowance. Both partners in a couple claim may get the carer addition.
If a claimant lives with a partner, they have to make a joint pension credit application and the income and capital of both partners is included. If one partner in a couple is over state pension age and the other person is under, they cannot claim pension credit until they both reach pension age.
Most pension income and certain benefits such as carer’s allowance are considered in the calculation of pension credit. However, some types of income are ignored, including any disability benefit such as PIP or attendance allowance.
Certain benefits are considered in the calculation of pension credit. However, disability benefits such as PIP or attendance allowance are ignored
Capital such as savings may have an impact on whether a claimant is entitled to pension credit or the amount they are awarded.
If a single or couple claimant has £10,000 or less in capital, this will be ignored in the pension credit assessment. If they have more than £10,000, every £500 over £10,000 is counted as generating £1 in income per week.
The deadline for applying to this year’s winter’s fuel payment was 21 December 2024.
