What is Pension Credit? Government calculator, how to claim, eligibility, how much you can get

Pensioners are being urged to apply for Pension Credit so that they can secure a £301 cost of living payment from the government.

The Department for Work and Pensions (DWP) and personal finance campaigners, like Money Saving Expert Martin Lewis, are urging those who are at or above state pension age to check whether they are eligible for the benefit. If they are, they could also receive extra financial support worth thousands of pounds from the government.

An estimated 1.4 million low-income pensioners across the UK receive pension credit. However, it is believed there are thousands of people who could be elibile but have not claimed it.

It comes after people who receive the state pension were given a significant uplift in April - albeit one that means they are still likely to be worse off than they were before the cost of living crisis began in early 2022. The Conservatives’ flagship triple lock policy looks set to be guaranteed for at least one more year before the next general election.

So, what is pension credit, who is eligible - and when do you need to apply by in order to get the state’s cost of living support?

What is Pension Credit?

Pension Credit is a type of benefit that pays out extra money to help with living costs if you’re over state pension age and on a low income. It is separate from your state pension, and you could still get Pension Credit if you have other income, savings or own your own home.

Pension Credit can help you with your housing costs, such as ground rent or service charges. You might get extra help if you’re a carer, severely disabled, or responsible for a child or young person. If you receive it, it also opens up other support such as:

• Housing Benefit, if you rent the property you’re living in
• Support for mortgage interest, if you own the property you live in
• A Council Tax discount
• A free TV licence, if you’re aged 75 or over
• Help with NHS dental treatment, glasses and transport costs for hospital appointments
• Help with heating costs through the Warm Home Discount Scheme, as well as cold weather payments
• A discount on the Royal Mail redirection service, if you’re moving house

Who is eligible for Pension Credit?

It is vital to check whether or not you are eligible for Pension Credit by Friday (19 May). This is because it is the last date on which you can claim it and be able to receive a £301 cost of living payment. You can also receive three months of backdated support, so long as you were eligible for it throughout this period.

To claim Pension Credit, you must live in England, Scotland or Wales and have reached the official retirement age. To find out more about Pension Credit in Northern Ireland, you can do so on the devolved government’s website.

It’s important to note that the state pension age is set to rise. You can use the age checker tool on the government website to see when you’ll qualify.

If you have a partner, they must be included on your application for Pension Credit as they can determine your eligibility. Single pensioners can get it if they have an income below £201.05 per week while couples can access it if they have a combined weekly income of less than £306.85.

The government defines several things as income. It includes your State Pension, any private pensions, earnings from employment and/or self-employment and most social security benefits, such as Carer’s Allowance. However, not all benefits are counted as income. For example, the following are not counted:

• Adult Disability Payment
• Attendance Allowance
• Christmas Bonus
• Child Benefit
• Disability Living Allowance
• Personal Independence Payment
• Social fund payments like Winter Fuel AllowanceHousing Benefit
• Council Tax Reduction

If you are entitled to a personal or a workplace pension which you have not yet claimed, the amount you expect to get still counts as income. The same applies if you have deferred your State Pension - something you may do if you have not got enough National Insurance contribution years to get the full State Pension.

If you have £10,000 or less in savings and investments, this will not affect your Pension Credit. But if you have more than £10,000, every £500 over the £10,000 counts as £1 in income per week. So, for example, if you have £11,000 in savings, this would be counted as £2 income a week.

You can access more Pension Credit cash if one of you has a disability or caring responsibilities. A partner is defined by the DWP as either “your husband, wife or civil partner - if you live with them” or “someone you live with as a couple, without being married or in a civil partnership”.

To check whether you are eligible, you can call the pension services hotline on 0800 99 1234 at any time between 8am until 5pm on weekdays (England, Scotland and Wales only). If you’re in Northern Ireland, the service is available on 0808 100 6165 between 9am and 4pm on weekdays.

These numbers are free to call and the person at the other end is meant to discuss your questions in a friendly and easy-to-understand way. Alternatively, you can find out if you are eligible through the government website.

What will you get with Pension Credit?

You can access thousands of pounds in government benefits with Pension Credit. The headline handout tops up:

• Your weekly income to £201.05 if you’re single
• Your joint weekly income to £306.85 if you have a partner

You could get extra money if you have additional responsibilities or costs. These extra amounts are known as ‘Guarantee Credit’. If you have a severe disability, you could get an extra £76.40 a week if you get any of the following:

• 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)

If you care for another adult, you could get an extra £42.75 a week if you receive a Carer’s Allowance or have claimed Carer’s Allowance but are not being paid because you already get another benefit paying a higher amount.

If you and your partner have both claimed or are both getting Carer’s Allowance, each of you will be eligible for an additional £42.75 a week. You can also claim an extra weekly £61.88 for each child or young person you’re responsible for. This amount rises to £72.31 a week for the first child if they were born before 6 April 2017.

The child or young person must normally live with you and be under the age of 20. If they’re 16 or over and under 20, they must be in (or accepted for):

• Approved training, like a foundation apprenticeship
• A course of non-advanced education, such as GCSEs or A levels 

If they’re in education, they must have an average of over 12 contact hours per week.

You should note that if you get Tax Credits, you cannot claim Pension Credit for caring for a child. But you might be eligible for Child Tax Credits. If the child or young person is disabled, you could get:

• An extra £33.67 a week if they get DLA, PIP or ADP
• An extra £104.86 a week if they’re blind or they get the highest rate care component of DLA or CDP (Child Disability Payment), or the enhanced daily living component of PIP or ADP.

What if I have savings?

You could get the Savings Credit part of Pension Credit if both of the following apply:

• You reached State Pension age before 6 April 2016
• You saved some money for retirement, such as through a personal or workplace pension 

You’ll get up to £15.94 Savings Credit a week if you’re single. Or, if you have a partner, you’ll get up to £17.84 a week. You can still get some Savings Credit, even if you don’t get the Guarantee Credit part of Pension Credit.

How do I use the Pension Credit calculator?

The government has a Pension Credit calculator on its website that you can use to calculate how much you coud get if you’re eligible for the benefit. To use the tool, you’ll need details of all of your earnings, benefits, pensions, savings and investments. If you have a partner, you’ll need these details off them as well.

Before you start, you should know that you cannot use if the calculator if you or your partner:

• Are deferring your State Pension
• Own more than one property
• Are self employed
• Have housing costs (like service charges or Crown Tenant rent) which don’t count as mortgage repayments or rent (as covered by Housing Benefit).

When you begin the calculator, you’ll be asked for your age, gender, where you live, if you’re registered as blind, if you live alone, the type of accommodation you live if, if you have a partner and if you or your partner own any property or land.

How do I apply for Pension Credit?

To claim Pension Credit you’ll need to make an application. You can start one up to four months before you reach State Pension age.

You can apply any time once you have reached the official retirement age, but you can only backdate your claim by up to three months (provided you were eligible for all three of them). For your application, you will need this information for both yourself and your partner (if you have one):

• National Insurance number
• All information about your income, savings and investments
• Details of your income, savings and investments on the date you want to backdate your application to

You’ll also need your bank account details. Pension Credit and any associated benefits are paid directly into your account. Depending on how you apply, you may also need your bank or building society name, sort code and account number.

You can use the online service to apply if you’ve already applied for your State Pension. Alternatively, you can apply over the phone by calling the Pension Credit claim line on 0800 99 1234. Lines are open Monday to Friday, 8am to 6pm.

You can also apply via post by printing out and filling in the Pension Credit claim form, which you can find on the Government website, and sending the completed form to the Pension Service at: The Pension Service 8, Post Handling Site B, Wolverhampton, WV99 1AN