Budget 2025: Income Tax
Winter Fuel Payments
From April 2026, pensioners whose total income is over £35,000 will have their Winter Fuel Payment (or pension age winter heating payment) clawed back via PAYE at a rate of roughly £17 a month for someone who receives the typical £200 payment. This will rise temporarily to £33 a month for a typical payment of £200 in the tax years 2027-28 to recover payments for 2026-27. An online payment calculator will be available to help asses if you are caught.
Gravita’s view
Well, the Chancellor kept this quiet! It was not that long ago that the government backed down from attempting to means test this benefit. It would appear that they have decided to ignore the calls from their members and bank benches and introduce means testing by stealth.
The Government state that the £35,000 is broadly in line with average earnings and well above the income level of pensioners in poverty. Arguably not a high bar!
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