New rules around payments have been set out by the Government
Pensioners should be aware of the rules.
Pensioners with incomes over £35,000 are being warned about deductions to their payments.
It’s part of new financial rules announced by Chancellor Rachel Reeves, related to the Winter Fuel Payment scheme.
Changes mean those with higher incomes are no longer eligible for the winter support – but they will still initially be paid the money.
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As they don’t qualify, that money is being clawed back in instalments by HMRC throughout the year.
The Government confirmed for a typical £200 payment, this would mean around £17 being deducted from state pension payments each month.
Retirees over the £35,000 annual limit should also be aware they are no longer eligible for Winter Fuel Payments.
These were previously universal for all pensioners before being scaled back.
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The Government explained: “If your total income is over £35,000, you’ll need to pay back the payment.
“HMRC will automatically collect the payment through your tax code unless you already file self-assessment tax returns.
“This means we’ll change your tax code for the 2026 to 2027 tax year. For a typical payment of £200, we’ll deduct approximately £17 per month.
“In the 2027 to 2028 tax year, we’ll deduct approximately £33 per month for a typical payment of £200.
“This is because we’ll be collecting your payments from 2026 and 2027. It will then return to approximately £17 per month for the 2028 to 2029 tax year.
“If you file your self-assessment tax return online each year, HMRC will automatically include the payment on your 2025 to 2026 tax return as part of your income.”