If you are getting Pension Credit or Universal Credit and still have a mort-gage, you may be able to get help paying some or all of your mortgage interest through a scheme called Support for Mortgage Interest (SMI). This help used to be given as an increase in your benefit payments. However, since 6 April 2018, that arrangement has been replaced. Now, if you opt for SMI, the help is treated as a loan which has eventually to be repaid to the government with interest, usually when you sell your home (though the loan can be transferred if you move).
If you are getting Pension Credit, SMI starts at the same time as your Pension Credit claim. In other cases, there is a nine-month waiting period. SMI covers interest only (not any capital repayments) and is limited to inter-est on a maximum of £100,000 of your loan if you are on Pension Credit, or £200,000 otherwise.
When you apply for Pension Credit or Universal Credit, you’ll also be offered an SMI loan if you are eligible.
HELP WITH RENT
If you are on a low income and you are under State Pension age, a claim for Universal Credit will normally include help with your rent. If you are over State Pension age you may instead be able to get Housing Benefit. In Northern Ireland, whatever your age, Housing Benefit can help you pay your rent and also your rates bill.
If you rent from your local council or a housing association, Housing Benefit is based on the rent you pay. However, if you are deemed to be living in a home that is larger than you need, what you get is reduced: by 14 per cent if you have one spare bedroom and 25 per cent if two or more. Couples are assumed to share a room unless that’s impossible because of disability.
If you rent privately, Housing Benefit is based on either what you actually pay or a Local Housing Allowance (LHA), whichever is the lower. The LHA that applies to you depends on the number of bedrooms you can claim for and the area in which you live. It is normally based on the 30 per cent of cheapest rents in an area and capped at a maximum amount, so it seldom covers your full rent.
Claim Housing Benefit in your Pension Credit claim or from your local council. Contact details are available from GOV.UK (Directory, p 18).
JOBSEEKER’S ALLOWANCE
If you’re under State Pension age, have been paying National Insurance and lose your job, you might qualify for Jobseeker’s Allowance (JSA). For over-25s, the amount is £84.80 a week (in 2023/24) paid for up to six months. After that, you might qualify for Universal Credit (see below). Apply for JSA online on the GOV.UK website or contact Jobcentre Plus on 0800 055 6688.
PENSION CREDIT
This is the main means-tested benefit for people over State Pension age, but if you are in a couple and one of you is younger, for new claims since 16 May 2019 you instead have to claim Universal Credit (which is less gener-ous). There are two parts to Pension Credit.
The Guarantee Credit tops up your income to a minimum level. In 2023/24, the standard amount is £201.05 a week for a single person and £306.85 for a couple, but you may get extra sums, for example if you have a disability, you are a carer or to help with some housing costs.
Only people who reached State Pension age before 6 April 2016 can now claim the Savings Credit. This is for people who have saved some money of their own for retirement. The maximum amount is £15.94 a week for a single person and £17.84 for a couple. You may qualify just for Savings Credit or for the Guarantee Credit as well. Government data shows that 3 out of 10 people eligible for Pension Credit don’t claim it, meaning that pensioners are losing out on £1.5 billion every year. Even if the amount you can get is small, it’s still important to claim, because Pension Credit acts as a gateway to other help, such as the recent government grants to help with the cost-of-living crisis, energy company low tariffs for low-income households and the free TV licence for over-75s. Apply online on the GOV.UK website or contact the Pension Credit Claim Line (0800 99 1234).
PERSONAL INDEPENDENCE PAYMENT (PIP)
This is a non-contributory, non-means-tested benefit for adults under State Pension age who have a physical or mental disability and aims to help with the extra costs you incur as a result. The amount depends on the extent to which a person’s daily living and/or mobility is affected and is determined after a medical assessment.
PIP has two components: a daily living component (£68.10 a week or £101.75 in 2023/24) and a mobility component (£26.90 a week or £71.00). A person can be entitled to either one or to both components.
In Scotland, PIP is being replaced with an equivalent benefit called Adult Disability Allowance. The assessment process is designed to be fairer, but a drawback in 2023 was that claims were taking several months to be processed.
UNIVERSAL CREDIT
This is the key means-tested benefit for people of working age whether in work or out of work. In 2023/24, the standard allowance is £368.74 a month for a single person aged 25 or over and £578.82 for a couple. However, there are lots of supplements you might qualify for, according to your dependants, disability, being a carer, housing costs and so on. You are normally expected to claim online on the GOV.UK website but, if you cannot, contact the Universal Credit Helpline on 0800 328 5644.
WINTER FUEL PAYMENT
This is a non-contributory, non-means-tested annual payment of between £100 to £300, given to all households with a resident over State Pension age. It’s normally given automatically if you are eligible; if not, call 0800 731 0160.
For the current (2023/24) and previous winter, the allowance has included an extra amount to help you cope with the cost-of-living crisis. It’s unlikely this will be repeated for winter 2024/25. If you are getting Pension Credit, you should also automatically get a Cold Weather Payment if there is a cold spell lasting more than a week. See GOV.UK (Directory, p 19).
Unclaimed or lost money
Make sure that you have not lost track of any money, for example in old bank and savings accounts or unclaimed lottery prizes. Experian estimates that there are £15 to £20 billion of unclaimed assets in the UK.
Banks, building societies and National Savings & Investments and other financial providers normally try to track down account owners but where this is unsuccessful, long-unused accounts and investments are transferred to a government-backed Dormant Assets Scheme, where the money is used for good causes. However, if you discover that your money has been trans-ferred to the scheme, you have the right to claim it back. You do this through My Lost Account (Directory, p 35).
The Dormant Assets Act 2022 extended the scheme to other types of assets, such as unused pension schemes, life insurance and other investments. Useful sites to help you trace these types of lost assets are:
- Gretel (Directory, p 35)
- Investment Association Unclaimed Assets Portal (Directory, p 35)
- Pension Tracing Service (Directory, p 32)
Be alert to scams. The websites mentioned above are free, independent services. Be wary of other sites that may deliberately use confusingly similar names, and never respond to unsolicited emails, texts or phone calls claim-ing to be able to reunite you with missing money.