Pension Credit

A tax-free entitlement for people aged 60 or over. You don't need to have paid National Insurance to get Pension Credit. There is no upper savings limit. Pension Credit currently guarantees a minimum income of at least £124.05 a week for single person; or £189.35 a week for a couple from April 2008. The rates increase each year in line with rises in average earnings.

It is based on the amount of money that you have coming in. You can claim Pension Credit whether or not you are still working. It can be backdated up to 12 months and paid to you in a lump sum.  From October 2008 backdating will be limited to 3 months.

Use the Pension Credit Calculator

Working out Pension Credit is complicated but the Pensions Service website has a handy calculator which gives you an estimate of whether you qualify. Click here for the calculator

Claim Pension Credit by telephone

You have to make a claim for Pension Credit. The national telephone helpline for Pension Credit is: 0800 99 1234

(textphone 0800 169 0133).

In Northern Ireland the Pension Service application line is: 0808 100 6165 (textphone 0808 1001165)

As you telephone, the Pension Service staff fill in an application form.  

You can also claim Pension Credit using form PC1 here.

More detailed explanation:

Pension Credit is made up of Guarantee Credit and Savings Credit.

The Guarantee Credit tops up your weekly income to a guaranteed level. The Savings Credit is for people who have a small amount of retirement income, for example company or state pension or savings. You may be entitled to the Guarantee Credit or the Savings Credit, or both. Pension Credit is administered by The Pension Service.

Who can get the Guarantee Credit
You can get the Guarantee Credit if you are 60 or over. It does not matter what age your partner is. You must be living in the UK and not have any immigration controls on your stay here that would stop you claiming benefits. You must also have income below a certain amount. The amount depends on your circumstances. There is no limit on how much capital - that is savings and property - you can have, but you will be treated as having income from any of your capital above £6,000.

Who can get the Savings Credit
You can get the Savings Credit if you or your partner is 65 or over. You must be living in the UK and not have any immigration controls on your stay here that would stop you claiming benefits.

How much Pension Credit can you get
When you apply for Pension Credit, the Pension Service will first work out if you are entitled to any Guarantee Credit, and if so how much. Then they will look at whether you can get any Savings Credit.

How much is your Guarantee Credit
Your weekly income (which includes your partner’s income if you live with your partner) is compared to a fixed weekly amount called the ’appropriate minimum guarantee’. The ‘appropriate minimum guarantee’ will vary for each person because it is made up of different elements which depend on your circumstances. The rates of the different elements are fixed and are usually increased every April.

Only certain types of income count for Pension Credit and not all your income will be taken into account.  Other income is partially disregarded, which means you can get a certain amount each week before it affects your Pension Credit. For example, Disability Living Allowance and Attendance Allowance are all fully disregarded. Savings above £6,000 (£10,000 if you live in a care home) will add to your income by £1 a week for every extra £500 (or part of £500).

Your amount of your Guarantee Credit is the difference between your ‘appropriate minimum guarantee’ and your income. If your income is more than your ‘appropriate minimum guarantee’, you will not get any Guarantee Credit, but you may still get some Savings Credit.

Your ‘appropriate minimum guarantee’ includes a standard minimum guarantee which is a set amount for a single person and a set amount for a couple. If you have additional needs, for example, because you are disabled, additional amounts will be added to your ‘appropriate minimum guarantee’. There are additional amounts for severe disability and for caring for a disabled person. If you have been transferred to Pension Credit from Income Support or income-based Jobseeker’s Allowance, you may also get an extra amount to make sure you are not any worse off.

Guarantee Credit and housing costs
If you have a mortgage or home loan, you may be able to get an extra amount to help with your mortgage interest. You may also be able to get help towards some other housing costs, for example, rent as a Crown tenant, ground rent for long leases and some service charges. However, in most circumstances, if you rent your home you cannot get any Guarantee Credit for housing costs and you should claim Housing Benefit instead.

If there are other adults living in your home apart from your partner, your landlord, or a joint owner, tenant or lodger, a deduction may be made from the housing costs which Guarantee Credit can cover. This might apply, for example, if you have an adult son or daughter living with you.

How much Savings Credit
The amount of Savings Credit you can get depends on whether you have more or less weekly income that the ‘Savings Credit threshold’. This is a rate which is set each year and depends on whether you are a single person or a member of a couple. If your income is less than or equal to the Savings Credit threshold, you will not get any Savings Credit. If your income is more than the Savings Credit threshold, you may get some savings credit. However, if your income is greater than your ‘appropriate minimum income guarantee’ (see under How much Guarantee Credit, above), it may be too high to get any Savings Credit.

When making a claim
You must provide certain information, usually within one month of making your claim. For example, you will need your National Insurance number or evidence to allow the Pension Service to find your number.  You will also have to prove your identity. You may be able to do this by providing a document such as a driving licence, birth, marriage or civil partnership certificate, or a passport. You may be asked to provide more than one piece of evidence. If you do not have any documentary evidence, try to provide as much other evidence and facts about yourself as possible.

You will also have to provide evidence of your income. This evidence could include, for example, pension pay slips, proof of service charges, and proof of any other money you receive. You have to send or show the Pension Service original documents, not photocopies. They will be returned to you as soon as possible.

Getting Pension Credit backdated
Usually you get Pension Credit from the day that you first get in touch with the Pension Service to tell them you want to claim. You will have to supply all the required information to support your claim within one month. However, you may be able to get Pension Credit for a period of up to twelve months before you make your claim. This is called backdating. You do not have to give a reason for making a late claim, as long as you explain on your claim form when you first became entitled to Pension Credit.

How is Pension Credit paid
Pension Credit will usually be paid directly into your bank, building society or post office account. The Pension Service will ask you about having your money paid directly into an account but you do not have to be paid this way if it is a problem for you. It is possible for Pension Credit to be paid by sending you a cheque in the post that can be cashed at the Post Office. If you are not able to collect your Pension Credit in person, you may be able to arrange for someone else to do this for you see under heading If you need help to claim or collect benefits.

Pension Credit and other help
If you are getting any Guarantee Credit (on its own or with Savings Credit), you will automatically get the maximum amount of help when you apply for other benefits, and you will get help with certain costs. If you are getting Savings Credit on its own, you may still be able to get help with some of these costs.

Being on Guarantee Credit means you will get maximum Housing Benefit and Council Tax Benefit. You will also get help with health costs, for example, free prescriptions, and help with the cost of court fees. Being on Savings Credit or Guarantee Credit means you can apply for help from the Social Fund, for example, budgeting loans, community care grants and funeral payments.

Problems with Pension Credit
If you have made a claim for Pension Credit and been refused, or think that the amount you have been awarded is wrong, you can ask the Pension Service to look at the decision again, or you can appeal to an independent tribunal. You should do this within one month of the decision.

If you unhappy with the service you have received from the Pension Service, for example, because of delays or errors, you should complain. You can do this whether or not you are also challenging a Pension Credit decision. 

Read the Pensions Service leaflet click here

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