Employment » Retirement » How To Boost Your Low-Income with Pension Credit

How To Boost Your Low-Income with Pension Credit

By IntFormalities
Updated on August 13, 2023
Estimated reading time: 7 minutes

Once you hit pensionable age, you will start receiving funds from your pension pot to sustain your daily living. While most people can afford to pay their bills and manage their lives with the money they saved during their working years, others are unable to live worry-free lives. For this reason, the UK government provides additional help to those pensioners who need extra money to boost their weekly income and cover their expenses. Here’s more about pension credit and what you need to do to access this benefit.

How to boost your low-income with Pension Credit
The Department of Work and Pensions offers people on a low income the possibility of boosting their income with pension credit.

What Is Pension Credit?

Pension Credit UK is tax-free money offered to senior citizens who are past the pension age but have a low income. Caregivers for older people, severely disabled individuals, or senior citizens in charge of young children can also access this money.

This money can be used to offset living costs and rent and house service charges. Thankfully, you can still receive pension credit even if you own your home, have savings, or have another source of income.

The Requirements and Documentation Needed

Receiving this money in the UK comes with specific pension credit eligibility requirements. Persons applying for this service must live in England, Scotland, or Wales and be over the state pension age. You can also get benefits for pension credit if you or your partner receive housing benefits.

However, if you are from the EU, Iceland, Norway, Switzerland, or Liechtenstein, you need a settled or pre-settled status to start benefiting from this program. So, when applying for pension credit, you will have to disclose the following about you and your partner (where applicable):

  • National Insurance Number (NIN)
  • Income, savings, and investment details
  • Bank or building society account number
  • Address
  • Contact information
  • Up to three months of backdated information about your savings, investments, or income
  • Information regarding whether you’ve been outside the UK for more than four weeks over the past four months

How to Apply for Pension Credit

Persons interested in applying for pension credit can use the three available options to send their requests. You can either apply online, via post or by phone.

If you choose to do it online, you must have all the necessary information nearby before commencing the application process. Key in your country of origin, date of birth, nationality, marriage or civil partnership status, your pension credit eligibility, and then provide your bank or building society account number. Once you completed all the required information, you can submit your request.

If you decide to use the mail, you will have to download the right forms from the internet, fill them out, attach the necessary documents, and send your application to Pension Service 8.

Phone applications are much more straightforward since you only have to answer the questions the person on the other end of the call will ask, and you’re good to go.

When Should You Apply?

Applications for this service are available all year round. Nevertheless, the government allows you to apply for pension credit as early as four months before reaching your pensionable age.

What Happens After You Apply?

After applying for this service, you will wait for your request to be reviewed. Most pension credit requests take at least 35 days to complete after receipt of all the application details. You may be required to send in more information to facilitate the eligibility process. If the request is approved, you will receive a notification either in your account, an SMS, mail, or voice call before you begin receiving the funds.

If your application is rejected, you can request a mandatory requisition to review the decision. If this doesn’t work, you can appeal to have the matter reviewed in court.

How Much Can You Get?

What you get is determined by your circumstances. However, the base payment for an individual is £182.60 if you are single and £278.80 if you have a partner. You may also be eligible for extra money if you have other responsibilities, such as costs resulting from:

  • A severe disability
  • Caring for another adult
  • Being responsible for a child
  • Caring for a disabled child
  • Housing

This pension credit calculator will help you calculate your pension credit. You usually start receiving your weekly payments to your bank or building society account number 5-6 weeks after the application. You will receive payments for three months the first time you apply; then, when you apply the second time, you will keep receiving the money until you report a change in circumstances.

You can opt for monthly payments instead of weekly payments. Use the monthly pension calculator to see how much you will get.

Can Pension Credit Be Combined with Other Benefits?

The pension credit can be combined with your regular pension money and other government benefits. For instance, you can claim cold weather payments if you qualify for pension credit. You can also be eligible for a free TV licence if you are 75 and above and for a reduction in your national health service costs. Council tax reduction, housing benefits, and support for mortgage interest are other benefits you can claim if you are receiving pension credit.

Can You Receive This Pension If You’re Living Abroad?

You can keep receiving pension credit if you travel abroad, but not for more than four weeks under normal circumstances. Nevertheless, you can keep receiving this money for up to 26 weeks if you are out of the UK for health-related reasons that a medical officer has approved.

Sadly, you will cease receiving pension credit if you permanently leave the UK. The benefit is reserved for individuals on state persons that only travel out of the UK for a few weeks. If you have any questions about this and other pension services, you can contact the department of work and pensions via their online contact form, visit their offices in person, or send a mail to the ministerial correspondence team.

Cost, Validity, and Processing Time

Applying for pension credit is free, but you will incur mail, internet, or call-rate costs depending on your selected application option. Once you start receiving the help, it is valid for as long as you need it until you report a change in circumstances, and it takes up to 6 weeks to process a request after receiving the application.

A Way To Boost Your State Pension

With the cost of living on the rise, senior citizens are finding it difficult to make ends meet. Pension payments are fixed and less substantial than they would have been if they were receiving their regular wages. However, this doesn’t mean they should struggle to pay their bills and afford a decent life. The Department of Work and Pensions offers people on a low income the possibility of boosting their income with pension credit. We hope you have all the information you need to apply for pension credit today.

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