OVER a million benefit claimants are set to get a pay rise in days and we reveal the key date to circle in your calendar.
The Government confirmed that pension credit rates will increase by 8.5% in April due to the triple lock remaining in place.
Chancellor Jeremy Hunt first revealed that the state pension will be going up by £901 in his Autumn Statement.
At the same time pension credit payments, worth an average of £3,900 a year, are also rising.
The amount pensioners can get from the state rises every year to keep up with the cost of things like food and household bills.
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The triple lock system sees the pension credit rise in line with whatever is highest out of: wages for May to July, 2.5%, or September's inflation figures.
Growth in employees' average total pay was 8.5% in the three months to July last year, while the UK's rate of inflation remained at 6.7% in September.
The Department for Work and Pensions confirmed both pension credit and the state pension will rise from April 8 - the first Monday after the new tax year begins.
It means pensioners signed up to receive the benefit will see a rise from £201.05 a week to £218.15, and from £306.85 to £332.95 for couples.
But the date it will rise will vary depending on when you normally get paid too.
Pension credit is usually paid every four weeks, so if you are expecting a payment between April 1 and 5, you might not actually see your pay rise until early May.
What is pension credit?
Pension credit is worth around £3,900 a year on average and unlocks many other benefits, such as council tax reductions and help with energy costs.
There are other bonuses available too, such as cold weather payments, free NHS dental treatment and a free TV licence.
While around 1.4million pensioners are already receiving pension credit, there are an estimated 880,000 households eligible for the support who are yet to claim it.
It's definitely worth seeing if you can apply.
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How much are payments increasing by?
Retirees on a low income can get it topped up via Pension Credit.
Pension Credit will go up from £201.05 a week to £218.15 or for couples, from £306.85 to £332.95.
If your income is lower than this, you should be eligible for the benefit.
You could get the "Savings Credit" part of Pension Credit if both of the following apply:
- You reached State Pension age before April 6, 2016
- You saved some money for retirement, for example, a personal or workplace pension
This part of Pension Credit will increase from £15.94 a week to £17.01 or for couples, from £17.84 to £19.04.
You may also get additional pension credit if you are disabled, have caring responsibilities or have to pay certain housing costs such as mortgage interest payments.
You can find out more about Pension Credit including how to apply in our guide.
Who is eligible for pension credit?
Anyone over the state pension age living in England, Scotland, or Wales is eligible for pension credit.
The state pension age is currently 66 for both men and women.
To qualify, you must have a weekly income of less than £201.05 for single people or £306.85 for couples.
Of course bear in mind, this minimum is going up to £218.15 and £332.95 respectively from April 8.
Your estimated income could include:
- Your state pension
- Any other pensions you have saved, for instance, workplace or private pension savings
- Most social security benefits, for example, carer’s allowance
- Any savings or investments worth over £10,000
- Earnings from a job
The calculation does not include:
- Attendance allowance
- Christmas bonus
- Disability living allowance
- Personal independence payment
- Housing benefit
- Council tax reduction
If your income is too high to get pension credit, you may still get some savings pension credit, so it's worth checking.
It used to be the case that couples, where one person was over state pension age, could claim, but new rules now mean that both people in a couple must be over retirement age to apply.
This means if you're single and move in with a partner who is younger than the state pension age, you will stop being eligible.
But if you're already receiving pension credit under the old system it won't stop unless your circumstances change.
How will I be paid?
Your benefits will usually be paid into a bank account roughly every four weeks.
You will be asked to provide your bank account details when you claim.
Concessions are sometimes made for people who don't have access to a bank account.
Meanwhile, we also reveal the exact date within weeks millions on Universal Credit and other benefits will get a pay rise.
Plus, how much state pension is rising by from April 8.
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