Chancellor Rachel Reeves has reversed last year’s decision to restrict winter fuel payments, confirming that pensioners in England and Wales with taxable incomes of £35,000 or less will again receive the benefit from this autumn. Those aged 67-79 will be paid £200, while over-80s will receive £300. Scotland and Northern Ireland run separate schemes.
The Treasury estimates the change will put about £1.25 billion into pensioners’ pockets, while recovering around £450 million by clawing back payments from wealthier recipients. Payments will be issued automatically by the Department for Work and Pensions and, where income exceeds the £35,000 threshold, HMRC will recover the full amount via PAYE or self assessment, mirroring the high-income child benefit charge. No registration is required, though an opt-out will be offered later this year.
The move brings nine million households back into scope after only 1.5 million qualified last winter when eligibility was tied to pension credit. Tax specialists welcome the broader support but warn that the new means test could add administrative complexity and fresh inequities between single- and dual-income households.
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.’
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