Pension credit to rise to a maximum of £279 a week next year – how changes will affect you explained

PENSION credit is set to rise next year, up to a maximum standard payment of £278.70 a week for couples.

Anyone who gets additional elements paid on top of their standard allowance will see those rates rise from April 2022 as well.

Pension Credit is designed to help retirees on a low income by giving them extra money to help with living costs.

How much you get depends on your specific circumstances, including whether you have a partner, if you're disabled, and whether you have caring responsibilities for young children.

The maximum basic allowance is currently £177.10 for single people and £270.30 for couples. From next April, this will rise to £182.60 and £278.70 respectively.

That means if your pension income is lower than these amounts, the government will pay you the difference in benefit top ups.

The rise is £5.50 a week for singles and £8.40 a week for couples – over the course of a year that adds up to £286 or £436.80.

How much will additional pension credit elements rise by?

If you have a severe disability, you can get up to £67.30 a week on top of your standard allowance. From April next year, this will rise to £69.40 – an increase of just £2.10 a week.

If you're in a couple and you're both severely disabled, the top up rises from £134.60 to £138.80.

Carers can also get a top up which is worth £37.70 a week currently, and will rise to £38.85 next year – just £1.15 a week more.

If you have caring responsibilities for young children you also get extra help.

For a first child born before April 6, 2017, the rate is £65.10 rising to £66.85. For subsequent children or those born after that date, the rate is lower at £54.60 increasing to £56.35 next year.

If your child has a disability, you can get a lower rate of £29.66 or a higher rate of £92.54 depending on the severity of the condition. From April, these rates rise to £30.58 and £95.48.

How much will savings credit rise by?

There is a second element to Pension Credit which is called Savings Credit, available to people who reached state retirement age before April 2016.

This is a little extra cash to reward people who have been saving for retirement.

The maximum you can get is £14.04 a week if you're single and £16.20 a week if you're in a couple. But these figures also rise next year to £14.48 and £16.20.

For every pound of income you have over the savings threshold, your savings credit is reduced by 40p.

The threshold is £153.70 for singles and £244.712 for couples, but from next year these will rise to £158.47 and £251.70 respectively.

You do not need to get guaranteed pension credit to qualify for savings credit.

How to apply for pension credit

According to official government figures, almost a million eligible people are missing out on Pension Credit worth £938.63 on average.

To qualify, either you (or your partner if you live with one) must have reached State Pension Age.

You also need to live in England, Scotland or Wales

Your household income will be calculated when you apply, and if you fall short of the thresholds you will be awarded a top-up amount.

Your income includes:

  • State Pension
  • other pensions
  • earnings from employment and self-employment
  • most social security benefits, for example Carer’s Allowance

If you have £10,000 or less in savings and investments this will not affect your Pension Credit.

If you have more than £10,000, every £500 over £10,000 counts as £1 worth of weekly income.

You can start your application up to four months before you reach State Pension age.

You can apply any time after you reach State Pension age but your application can only be backdated by three months.

You can use the online service if:

  • you have already applied for your State Pension
  • there are no children or young people included in your application

You can apply online using the government service.

Alternatively, you can apply by phone on the Pension Credit claim line on 0800 99 1234.

To apply by post, print out and fill in the Pension Credit claim form or call the claim line to request one.

Pension Credit entitles you to loads more benefits, including help with rent, council tax discounts and even free TV licenses, so it's well worth claiming.

We pay for your stories!

Do you have a story for The Sun Money team?

Email us at [email protected]

    Source: Read Full Article