Thousands of people who get Tax Credits are in danger of forfeiting a vital cash boost. The warning comes as they make the switch to the Pension Credits and Universal Credit system.
The Department for Work and Pensions (DWP) is sending out warning letters to those yet to make the changeover. Yet, alarmingly, about a third are failing to respond.
Now the DWP has announced when “closure notices” will be sent to individuals who receive Tax Credits alongside their State Pension.
And ignoring these could mean losing the benefits completely – something that has already affected thousands in recent months.
From September, elderly claimants will begin receiving the letters. In addition, some have already been circulated according to local authorities’ advice. On receiving the letter, there is a three-month period within which pensioners must apply for Pension Credit, or in some cases Universal Credit, or risk losing out.
The Manchester Evening News says pensioners not applying for Pension Credit by December will miss out on this crucial financial support.
Pension Credit ensures that pensioner income reaches a certain minimum level. This Credit can significantly increase weekly income for those on State Pension – potentially adding up to £218.15 for individuals and £332.95 for couples, reports the Daily Star.
Last week, Chancellor Rachel Reeves unveiled her plans to increase the uptake of Pension Credit among eligible seniors. The average top-up will equate to £3,900 in annual financial aid. As the Winter Fuel Payment has been discontinued for all except those claiming this benefit, applying for this assistance will be really important for pensioners seeking financial support.
Those who may experience a drop in income due to the shift from Tax Credits to Pension Credits can receive an additional top-up to prevent a decrease in their living standards.
The DWP clarifies: “Claimants who are sent a migration notice or closure notice and would otherwise see a reduction in benefit entitlement following the closure of their Tax Credit award may be considered for an additional amount to makeup the shortfall. This is called a transitional additional amount.”
Most individuals of pension age will receive a closure notice, instructing them to apply for Pension Credit. However, some people, depending on their life circumstances, will receive a “migration notice” asking them to apply for Universal Credit instead.
Tax Credit claimants of pension age will be asked to claim Universal Credit if, on the date the DWP sends them a migration notice, they are:
- Not already claiming Pension Credit
- Entitled to Working Tax Credit but only getting Child Tax Credit (because their income has reduced their Working Tax Credit to nil)
- In receipt of Working Tax Credit or Working Tax Credit and Child Tax Credit
- A member of a mixed-age couple in receipt of Working Tax Credit and/or Child Tax Credit (but see below for the exception to this rule)
Check your Pension Credit eligibility
The Department for Work and Pensions (DWP) is urging people to use the online Pension Credit calculator on GOV. UK to see if they, a family member, or a friend could be eligible for the extra support that Pension Credit offers.
The online tool can be used to swiftly check eligibility and get an estimate of potential benefits.
Pensioners also have the option to contact the Pension Credit helpline directly to make a claim at 0800 99 1234 – lines are open from 8am to 6pm, Monday to Friday.
Expert help and advice can also be sought from Citizens Advice, Income Max, Independent Age and Age UK.
