June 15th 2023.
Are you aware that you could be eligible for pension credits? With the financial crunch taking its toll, more and more people are on the lookout for schemes and benefits to help them out. Martin Lewis has recently encouraged state pension holders to check if they are entitled to pension credits as this could mean that they receive thousands of pounds extra annually.
Pension credits are paid directly to your bank like other benefits and are intended to assist those who have a lower income. Pension credits are not the same as state pensions and the question arises as to who can claim and how does the government scheme work?
Pension Credit is a benefit which is related to income. There are two types of Pension Credit – Guarantee Credit and Savings Credit. Guarantee Credit tops up your weekly income if it is below a certain amount while Savings Credit is an additional payment for those who have money saved for retirement in the form of a pension or something similar.
For single people, up to £201.05 of Guarantee Credit and an extra Savings Credit of £15.94 can be claimed. Couples, on the other hand, can receive up to £306.85 weekly in Guarantee Credit and an additional £17.84 in Savings Credit. Pension Credit is also tax-free.
To be eligible for pension credit in the UK, you must live in England, Scotland or Wales and be of State Pension age or older. The State Pension age is determined based on gender and date of birth and is subject to regular review. To qualify for Guarantee Credit, your income will be calculated based on the state pension you receive, other pensions, social security benefits, your earnings, and your savings.
If your income is above £201.05 or £306.85 for singles or couples respectively, you may not be eligible for pension credits. However, you may still qualify if your income is lower than this even if you have savings, a pension, or a home. If you reached State Pension age before 6 April 2016, you can claim Savings Credit.
To find out more and get advice on how to claim pension credits, you can visit the 'How to Claim' section on gov.uk.
We hope this article was helpful in understanding what pension credits are and how to claim them. Share your experiences in the comments section!
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