Winter fuel payments to be clawed back via tax system
A government U-turn on the winter fuel payment was announced this week, with a new means-tested threshold. How will this work in practice?
Recent weeks have been rife with speculation that the government would announce a climbdown for the current year, and this has now happened. Under the new system, all pensioners will initially receive the winter fuel payment. For those with incomes above the new threshold of £35,000, this will then be clawed back via PAYE or self-assessment (as applicable). The government has confirmed that this threshold will apply to each individual, not to each household.
The threshold includes all sources of taxable income, so pensions (including the state pension) will be included, but qualifying ISA interest won’t be. It will be possible to opt out of receiving the payment, e.g. where you know your income will exceed the threshold. Crucially, the government has confirmed that nobody will need to register with HMRC as a result of the changes.
Related Topics
-
Late payment interest to be cut
A cut to the Bank of England base rate means there will be another reduction in HMRC's penalty interest rates. What are the new charges and when will they take effect?
-
Opt out of winter fuel payments by 15 September
HMRC has issued new guidance on the winter fuel payments. What do you need to know?
-
Change to IHT on pensions proposals
HMRC has published a policy statement announcing an important change to its plans to include pension savings in an individual's estate for inheritance tax (IHT) purposes. What’s the full story?
This website uses both its own and third-party cookies to analyze our services and navigation on our website in order to improve its contents (analytical purposes: measure visits and sources of web traffic). The legal basis is the consent of the user, except in the case of basic cookies, which are essential to navigate this website.