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Money Tips

What are the Pension Credit changes?

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Pensioners on low incomes with partners who haven’t yet reached State Pension age are being urged to claim Pension Credit before Government rules change on May 15.

Under the new rules, claimants living with a partner who isn’t yet a pensioner will no longer have the right to claim Pension Credit and Housing Benefit and instead must apply for the less generous Universal Credit.

The standard Universal Credit payment is £498.89 a month in 2019, whilst the Pension Credit maximum is £255.25 a week.

According to charity Age UK, pensioners who put in a claim for Pension Credit now rather than waiting until the rules change in May could end up as much as £7,000 better off every year until their younger partner becomes a pensioner.

It says that some pensioners may even end up being financially better off if they split up and live apart from their younger partner because they’d be eligible for less money if they claim Universal Credit as a couple than if the older partner claims Pension Credit as a single person.

Who’s affected?

The changes will affect anyone who has a partner below State Pension age, currently 65 for men and women, who puts in a new claim for Pension Credit after May 15.

According to the Department for Work and Pensions (DWP) around 15,000 mixed age couples will be affected by the policy change in the 2019/20 tax year, rising to 30,000 in the 2020/21 tax year.

The changes won’t affect those who are currently claiming Pension Credit, although if a couple where one partner hasn’t reached pension age temporarily loses their eligibility for Pension Credit from May 15, they will move onto the Universal Credit regime.

Pension Credit eligibility can be lost temporarily if, for example, the pensioner partner goes overseas for more than four weeks.

Find out more about changes to Pension Credit.

How do I claim what I'm entitled to?

Lots of older people are missing out on benefits they’re entitled to.

Age UK says that nationally, half of couples, equivalent to 360,000 couples, who could claim Pension Credit are not receiving it.

Among single pensioners, 37% or 840,00 people who should be receiving Pension Credit have not claimed it. Latest figures from the DWP show that up to £3.5 billion of available Pension Credit went unclaimed in 2016/17; on average, this amounted to around £2,500 per year for each family entitled to receive Pension Credit who did not claim the benefit.

To find out whether you might be entitled to claim benefits, log on to the website Turn2us.org.uk and use the Benefits Calculator. This will let you know which benefits and you might qualify for, as well as how you can make a claim.

Another useful source of information is entitledto.co.uk, which also helps to find out what you could claim.