Struggling with bills? Put in a pension credit claim NOW

Older people struggling to pay bills are being urged to get a pension credit application in by 19 May in order to qualify for the latest £301 cost of living payout.

The Government plans to give people on means-tested benefits £900 spread across three payments over the coming year, plus a further £150 if you are on disability benefits and a £300 top-up for pensioners to help with energy bills.

As long as you submit a pension credit application by a week on Friday which is eventually successful, your claim can be backdated by three months and you will get the latest cost of living payment.

> How do you claim pension credit? Full details below

That means even if there is a backlog, something which has caused long delays in the past, you will still be within the time limit to receive the first in the series of three 2023-24 payments.

If you are elderly and not well off, pension credit tops up weekly income to a minimum of £201.05 for single people and £306.85 for couples, and it can be more if you have a disability or caring responsibilities.

It is set just below the level of the full new ‘flat rate’ state pension for people retiring since 2016, which after a recent 10.1 per cent hike is worth £203.85 a week or £10,600 a year

The old basic state pension is now £156.20 a week or around £8,120 a year – but that is topped up by additional state pension entitlements, S2P and Serps, if these were earned during working years.

You do not need to receive a state pension to be eligible to claim pension credit, and a rainy day fund of up to £10,000 will be disregarded if your income is low and you meet other rules.

Pension credit also opens to door to a lot of additional support, including extra help with energy bills, council tax, housing costs, and free TV licenses if you are over 75. 

However, despite the benefits hundreds of thousands of eligible people do not claim.

The Government says the latest £301 cost of living payment is available to people entitled to one of seven benefits between 26 January and 25 February 2023.

The eligible benefits are: Universal Credit; Pension Credit; Income-based Jobseekers Allowance; Income-related Employment and Support Allowance; Income Support; Working Tax Credit; and Child Tax Credit.

It says these payments are tax-free, will not count towards the benefit cap, and will not affect existing benefit awards.

The £150 cost of living payment for those on disabilities will be paid this summer. The eligible benefits are: Disability Living Allowance; Personal Independence Payment; Attendance Allowance; Scottish Disability Benefits; Armed Forces Independence Payment; Constant Attendance Allowance; and War Pension Mobility Supplement.

Meanwhile, the £300 cost of living payment for pensioners will be paid to all households receiving Winter Fuel Payments.

Pensions Minister Laura Trott says: ‘Pension credit can make a real difference and I am determined to make sure this support – worth an average of £3,500 a year – is reaching everyone who needs it, particularly as we know how much pressure households across the country have been under.

‘Please check if you or your loved ones can claim for this extra support, and if you do it by 19 May you could qualify for the £301 cost of living payment – giving another financial boost to those who need it most.’

Jon Greer, head of retirement policy at Quilter, says: ‘It’s key that pensioners on low incomes check their eligibility for pension credit, if they haven’t already, as the deadline for application looms.

‘Unfortunately, for lots of reasons many pensioners miss out on claiming pension credits whether it’s because of a lack of awareness or a feeling that they won’t be eligible so they don’t bother.

‘However, if missed, eligible pensioners miss out on a significant boost to their retirement income and also cost of living payments.

‘The importance of claiming this credit if eligible cannot be overstated, especially considering the financial challenges that many households across the country are currently facing.’

Alice Guy, head of pensions and savings at Interactive Investor, says: ‘Pension credit provides a lifetime to millions of pensioners on a low income by topping their income to lift them out of poverty.

‘It’s a huge worry that around 850,000 pensioners are entitled to pension credit and aren’t currently claiming. They are potentially living hand to mouth and struggling in poverty when there is help available.

‘Two-thirds of those claiming pension credit are women and the burden of pensioner poverty falls disproportionately on women, who have often spent years out of the workplace, caring for loved ones.

‘The onus is on us all to speak to elderly relatives and make sure they’re claiming everything they are entitled to. 

‘Many poorer pensioners have spent years caring for loved ones or living with a disability and not managed to build up enough National Insurance credits to get a full state pension.’