People may be eligible for pension credits and not even realise it(Picture: Getty)
With the cost of living crisis continuing to bite, people are very keen to know more about what schemes are out there to help them out.
Martin Lewis has recently urged those in receipt of the state pension, to check if they are eligible for pension credit, as this could mean they are entitled to thousands more per year.
Paid direct into your bank account, like other benefits, pension credits are designed to aid those living on a lower income.
Pension credits are different from a state pension, but who can claim and how does the government scheme work?
What are pension credits?
Pension Credit is an income-related benefit.
People can earn two different types of Pension credit.
The first is Guarantee Credit, which tops up your weekly income if it’s below a certain amount.
The second is Savings Credit, which is an additional payment for those who have money saved towards retirement, in the form of a pension or similar.
If you’re single, you can get up to £201.05 of Guarantee Credit per week if you qualify and a potential additional Savings Credit of up to £15.94
Couples can have their weekly income topped up to £306.85 every week with Guarantee Credit and claim an additional £17.84 in Savings Credit if eligible.
You do not pay tax on Pension Credit.
Carers, those who are severely disabled, responsible for a child or young person, or have certain housing costs may be able to claim more than the amounts stated.
You can use the government’s online Pension Credit calculator to work out how much Pension credit you could claim.
Who is entitled to pension credit in the UK?
To be eligible for pension credit, you must live in England, Scotland or Wales and be of State Pension age or older.
As State Pension age is worked out based on gender and date of birth, it differs between generations and is also regularly under review.
You can check your current State Pension age online here.
To be eligible for Guarantee Credit, as well as reaching State Pension age, your income will be calculated based on if you receive a state pension, other pensions, social security benefits, what your earnings are and what savings you have (if any).
If your income totals over £201.05 a week (if you’re single) or £306.85 (if you’re a couple) then you may not be entitled to pension credit in the UK.
You may still be eligible for pension credit if your income is lower than this, even if you have savings, a pension or your own home.
You can also only start getting Savings Credit if you (and your partner) reached State Pension age before 6 April 2016.
For more information and advice on how to claim pension credit, you can visit the ‘How to Claim’ section on the gov.uk website.
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