Nine Million Pensioners to Receive Winter Fuel Payments This Winter
In a move to support lower and middle-income pensioners, the UK government has announced that nine million pensioners will receive Winter Fuel Payments this winter. According to a statement from the UK Government, all pensioners in England and Wales with an income of, or below, £35,000 a year will benefit from a Winter Fuel Payment.
This increased threshold means that no lower or middle-income pensioners will miss out, with the vast majority – over three quarters – of pensioners in England and Wales receiving the payment. The UK Government stated that support will continue to be targeted, with pensioners above this threshold having the payment automatically recovered or able to opt out.
The change will cost around £1.25 billion in England and Wales and see means-testing of the Winter Fuel Payment save around £450 million, subject to certification by the Office for Budget Responsibility (OBR) compared to the system of universal Winter Fuel Payments. The costs will be accounted for at the Budget and incorporated into the next OBR forecast. The Chancellor will take decisions on funding in the round at that forecast to ensure the government’s non-negotiable fiscal rules are met. This will not lead to permanent additional borrowing.
As reported by the UK Government, no pensioner will need to take any action as they will automatically receive the payment this winter, and for those with incomes above the threshold, it will be automatically recovered via HMRC. The payment of £200 per household, or £300 per household where there is someone over 80, will be made automatically this winter. Over 12 million pensioners across the United Kingdom will also benefit from the Triple Lock, with their State Pension set to increase by up to £1,900 this parliament.
Chancellor of the Exchequer 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.
The UK Government also stated that pensioners above the £35,000 threshold will have the full amount of the Winter Fuel Payment they received automatically collected via PAYE, or via their Self-Assessment return. No one will need to register with HMRC for this or take any further action. Pensioners who want to opt out and not receive the payment at all, will be able to do so, with details to be confirmed.
Making these changes now gives people certainty and ensures that payments can be made in time for this winter. Payments will be better targeted than before 2024-25 when they were previously paid to all pensioners regardless of their income, meaning those on lower and middle incomes will still receive the help they need, ensuring fairness for both pensioners and taxpayers.
Approximately 2 million individuals in England and Wales over State Pension age have taxable incomes above £35,000.
More Information
- Eligibility is based on a person’s age and place of residence during the qualifying week (the third full week of September). For winter 2025/26, the qualifying week will be 15 to 21 September 2025.
- A person needs to have reached State Pension age by the end of the qualifying week to be eligible.
- Winter Fuel Payments are worth £200 per household, or £300 per household where there is someone aged 80 or over. Shared payments are made to pensioners not on an income-related benefit.
- The payment will be recovered from individuals via HMRC based on their individual taxable incomes. There will be no need for household incomes to be aggregated.
- It will be recovered via PAYE for the vast majority, or in their Self-Assessment tax return for the minority who file and pay their taxes in this way. HMRC will work closely with representative bodies to ensure the process is as simple as possible with clear guidance for taxpayers.
- For those who would like to opt out from receiving the Winter Fuel Payment, DWP will develop a simple system to enable individuals to do so, removing the need for HMRC to recover the payment. Further information will be on GOV.UK in due course.
- The government will be publishing an equalities analysis alongside the legislation and a Tax Information and Impact Note at Budget.
Further Background
- As of winter 2024/25, Winter Fuel Payments were restricted in England and Wales to pensioner households receiving Pension Credit or certain other income-related benefits.
- It is worth £200 for eligible households, or £300 for households with someone aged 80 or over. It is a non-contributory, household payment to support pensioners during the colder months.
- From 2025/26 Winter Fuel Payments will be payable in England and Wales at £200 for households including someone between State Pension age and 79, and £300 for households including someone aged 80 or over. Where the household is not getting an income related benefit, such as Pension Credit, a shared payment will be made – e.g. a couple, each under 80, not on Pension Credit will receive a payment of £100 each.
- Winter Fuel Payments are transferred in Northern Ireland. The policy area is devolved to Scotland. The Scottish Government and the Northern Ireland Executive will both receive a mechanical uplift in their funding as a result of this change in England and Wales.
