Pension credits can help certain people in the UK get thousands more a year and with that With the cost of living crisis, people are very keen to learn more about what programs are out there to help them.
Rishi Sunak has outlined some measures to cut the rising costs, including a one-off payment of £650.
Pension credits, which like other benefits are paid directly into your bank account, are designed to help those on lower incomes.
Pension credits are different from a state pension, but who is eligible and how does the state system work?
What are pension credits?
Pension Credit is an earnings-related benefit.
People can purchase two different types of retirement credits.
The first is the Guarantee Credit, which tops up your weekly income if it’s below a certain amount.
The second is the savings loan, which is an additional payment for those who have saved money for retirement in the form of a pension or something similar.
If you’re single you can get up to £173.75 in guarantee credit per week if you qualify and a potential extra savings credit of up to £13.97.
Couples can top up their weekly income to £265.20 each week with the Guarantee Credit and claim an additional savings credit of £15.62 if eligible.
You pay no taxes on the annuity loan.
Caregivers, severely disabled persons responsible for a child or young person or persons with certain housing costs may be able to claim more than the stated amounts.
You can use the government’s online retirement credit calculator to calculate how much retirement credit you can claim.
Who is eligible for UK pension credit?
To be entitled to a pension credit you must live in England, Scotland or Wales and be of at least state pension age.
Since the statutory retirement age is calculated by gender and date of birth, it differs between generations and is also regularly reviewed.
You can check your current statutory retirement age online here.
To qualify for a Guarantee Credit, your income is calculated based on whether you receive a state pension, other pensions, Social Security benefits, your income, and your savings (if any), in addition to reaching state retirement age.
If your total earnings are more than £173.75 per week (if you are single) or £265.20 (if you are a couple) you may not be entitled to a UK pension credit.
Even if you have savings, a pension, or your own home, you may still be eligible for a pension credit if your income is lower.
You can also only get the savings loan if you (and your partner) reached statutory retirement age before April 6, 2016.
For more information and advice on applying for pension credit, see the ‘Applying’ section of the gov.uk website.
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https://metro.co.uk/2022/06/16/what-are-pension-credits-and-who-is-entitled-to-pension-credit-16841359/ What are pension credits and who is eligible for pension credits?