Pensioners earning under £35k to receive Winter Fuel Payment

Nine million pensioners in England and Wales will receive a Winter Fuel Payment this winter under new government plans announced by Chancellor Rachel Reeves.

Pensioners with an income of £35,000 a year or below will automatically receive the payment, worth £200 per household or £300 where someone is aged over 80.

The Treasury said the change will cost around £1.25 billion in England and Wales but is expected to save £450 million compared to restoring the previous universal system.

The new income threshold extends eligibility to more than three quarters of pensioners in England and Wales.

The Treasury described the threshold as being above the income level of pensioners in poverty and broadly in line with average earnings.

Chancellor of the Exchequer Rachel Reeves said: “Targeting Winter Fuel Payments was a tough decision, but the right decision because of the inheritance we had been left by the previous government.”

“It is also right that we continue to means-test this payment so that it is targeted and fair, rather than restoring eligibility to everyone, including the wealthiest.”

“But we have now acted to expand the eligibility of the Winter Fuel Payment so no pensioner on a lower income will miss out.”

No action will be required by pensioners, as payments will be made automatically.

For pensioners with incomes above £35,000, the payment will be recovered through PAYE or Self-Assessment.

Pensioners will also be given the option to opt out of receiving the payment.

The government had indicated last month that eligibility for Winter Fuel Payments would be widened but had not previously confirmed the income threshold.

The decision to restrict universal Winter Fuel Payments was one of the first taken by the new Labour government, although it was not included in the party’s election manifesto.

The change had proved controversial and was widely viewed as a factor in the party’s poor performance in the May local elections.

The Treasury said the costs of the new policy will be accounted for at the autumn budget.

Eligibility will be based on age and residence during the qualifying week of 15 to 21 September 2025.