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.
Pensioners aged 67–79 will be paid £200, while those over 80 will receive £300. Scotland and Northern Ireland operate separate schemes.
The Treasury estimates the change will put about £1.25 billion into pensioners’ pockets, after recovering around £450 million from wealthier recipients. Payments will be issued automatically by the Department for Work and Pensions. Where income exceeds £35,000, HMRC will recover the full amount via PAYE or self assessment, using a mechanism similar to the high-income child benefit charge. No registration is required, though an opt-out option will be introduced later this year.
The move brings nine million households back into scope, after only 1.5 million qualified last winter when eligibility was linked to pension credit. Tax specialists have welcomed the broader support, but warned that the new means test could increase administrative complexity and raise concerns about fairness 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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