Pension Credit


Pension Credit is a means-tested benefit which depends on your income and savings. It is designed to provide those over qualifying age (see below) with a minimum level of income, and give extra cash to pensioners with modest incomes who have made savings for their retirement. 


The qualifying age for Pension Credit is gradually going up in line with the increase in women’s State Pension Age (see page 67).


Pension Credit currently has two elements:


• the Guarantee Credit tops up your weekly income if it’s below £163.00 (single person), or £248.80 (couples) for those who have reached the minimum qualifying age; and


• the Savings Credit is an extra payment for those who have some savings or pension that brings their income to the required level (see page 73). To qualify you or your partner must have reached Pension Credit Qualifying Age (see page 67). 


As part of the Pensions Act 2014, the Savings Credit part of Pension Credit closed for people reaching SPA on or after 6 April 2016. You may still get Savings Credit if you are part of a couple and one of you reached SPA before 6 April 2016, but most people who reached SPA on or after this date will not be eligible. 


Entitlement to Pension Credit


Entitlement to each part of Pension Credit is calculated separately, so you could get either or both. You can apply for Pension Credit regardless of the amount of savings that you have. Any savings below £10,000 will be disregarded, while savings above this level will be deemed to provide an income of £1 a week for each £500 or part thereof. These amounts may be more if you are disabled, have caring responsibilities or certain housing costs, such as mortgage interest payments.


If you are aged 65 or over (and reached SPA before 6 April 2016) you may be entitled to Savings Credit if your income is more than the Savings Credit threshold. You may get the Savings Credit on its own or with Guarantee Credit. You may be entitled to Savings Credit if you:


• are aged 65 or over; and


• have made some provision towards your retirement, such as savings or a second pension.


From April 2018, the single person’s Savings Credit threshold rises from £137.35 to £140.67 a week, while the couple’s threshold rises from £218.42 to £223.82 a week.


The maximum amount payable through Savings Credit increased from £13.20 to £13.40 a week for a single person, and from £14.90 to £14.99 a week for a couple.