A guide to Pension Credit
What is Pension Credit? How does it work? What's the difference between Savings Credit or Guarantee Credit? We'll walk you through what you need to know
What is Pension Credit?
The aim of this benefit is to help with the cost of living for older people. It is separate from the State Pension and those who want to claim it will need to apply via the government website. Those with savings and assets may still be eligible for Pension Credit.
Pension Credit claimants can also access other benefits, such as free dental care, discounted Council Tax, Warm Home Discount, Housing Benefit for those who are renting and help with mortgage interest for homeowners.
According to Carers UK, four out of 10 people who are eligible for Pension Credit don’t claim it, so it’s always worth checking if you can. You may also be able to get additional help if you are severely disabled, are a carer or look after children.
How does Pension Credit work?
Pension Credit comes in two parts and you may be eligible for both when you apply.
Guarantee Credit:
This version of Pension Credit tops up your income, ensuring it reaches a guaranteed minimum level.
This changes each financial year. In 2024/25, the level is £218.15 per week for single people and £332.95 for couples.
Savings Credit:
For anyone who reached State Pension age before 6 April 2016, Savings Credit is a top up for those with some savings or earnings higher than the State Pension (from, for example, a company or private pension).
This works out as £17.01 per week if you’re single and £19.04 if you’re a couple.
What are the income and savings thresholds for Pension Credit eligibility?
In order to receive Pension Credit, your income and any savings will be taken into account on application.
If you have less than £10,000 in savings, this will not impact your Pension Credit claim. For every £500 over £10,000, £1 a week will be considered as income. So if you have £11,000 in savings, that will count as £2 of income a week.
It’s worth remembering that company or private pensions that have not yet been claimed are counted as income. And if you defer the State Pension, that amount still counts as income too.
The minimum weekly income thresholds are £218.15 per week for single people and £332.95 for couples.
To get Savings Credit, you’ll need to be bringing in more than £189.90 if you’re single, rising to £301.22 for couples.
Remember, you’ll need to have reached State Pension age before 6 April 2016 to claim Savings Credit. At that time, the retirement ages were 65 for men and 63 for women.
How do I apply for Pension Credit?
You can apply for Pension Credit via the Gov.uk website if you’re from England, Scotland, Wales or Northern Ireland.
You can apply up to four months before you reach retirement age. Applications can be backdated, but only by three months.
You’ll need to have your National Insurance number, as well as details about any savings, income and investments you have.
Have your bank details to hand too, as you’ll need to enter these to receive any payments.
The government says it takes roughly 20 minutes to apply for Pension Credit. You can also apply by phone by calling 0800 99 1234.
You can apply by post by printing out the claim form and posting it to:
The Pension Service 8
Post Handling Site B
Wolverhampton
WV99 1AN
Am I likely to be accepted for Pension Credit?
If you’re over the current State Pension age, currently 66, you will be accepted for Guarantee Credit if your weekly earnings don’t exceed the weekly minimum thresholds of £218.15 per week for single people and £332.95 for couples.
For Savings Credit, you’ll be accepted if you reached State Pension age before 6 April 2016 (which was 63 for women and 65 for men at the time) and match the criteria of earning more than £189.90 if you’re single, rising to £301.22 for couples.
If you have large amounts of savings and earn more than the weekly minimum for Guarantee Credit, you are unlikely to be accepted.
However, if you feel you are eligible and are rejected for Pension Credit, you can challenge that decision as part of a process called mandatory reconsideration.
Is Pension Credit taxable?
No, Pension Credit is tax-free. Recipients do not need to have made National Insurance pension contributions to be eligible, unlike the State Pension.
How much could I receive in pension credit?
If you are eligible for Pension Credit, you can top up your weekly income through Guarantee Credit to £218.15 per week for single people and £332.95 for couples.
Savings Credit can add up to £117.01 per week if you’re single and £19.04 per week if you’re a couple.
If you’re severely disabled, you could get an additional £81.50 a week if you claim any of these other benefits:
Attendance Allowance
The middle or highest rate from the care component of Disability Living Allowance (DLA)
The daily living component of Personal Independence Payment (PIP)
Armed Forces Independence Payment
The daily living component of Adult Disability Payment (ADP) at the standard or enhanced rate.
Carers for other adults can get £45.60 a week if they also receive Carer’s Allowance, Carer Support Payment, or if they’ve claimed Carer’s Allowance but aren’t being paid because they already get another benefit paying a higher amount.
Those looking after young people under 20 can also claim £66.29 a week for every child, rising to £76.79 for the first child, as long as they were born before 6th April 2017. Children between 16 and 20 must be in approved training or studying for GCSEs, A Levels or equivalent.
If any of the children being cared for have a disability, it’s possible to claim £35.93 a week if they get DLA, PIP or ADP; £112.21 a week if they’re blind, receive the highest rate care component of DLA or CDP, or the enhanced daily living component of PIP or ADP.
How does Pension Credit work if I have a partner?
You can claim Pension Credit if you have a partner. However, you’ll both need to be above State Pension age. Only one person can apply, as the Pension Credit payment will be made to one person to cover both of you.
Can I claim the State Pension and Pension Credit?
Yes, you can claim the State Pension and Pension Credit, as they are separate.
Pension Credit is designed to top up any income, ensuring that those above State Pension age have a greater minimum income.
What happens if my circumstances change while I'm on Pension Credit?
It’s your responsibility to inform pension services of any changes to your personal or financial circumstances. You can do this via the government website.
Such changes include a change of address, the death of a partner, stopping looking after dependents or changing your bank.
Are there any other services available to offer additional support?
Yes. Remember that claiming Pension Credit can help you access additional support, such as the Warm Home Discount, Council Tax discounts, housing benefit for those renting, help with mortgage interest for homeowners, free TV licence for over 75s and free NHS dental treatment.
Other useful guides
We have a range of guides to help you navigate your pensions decisions:
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