What is the Help to Save scheme and who is eligible?

Full answer

Help to Save is a targeted government savings account aimed specifically at people on low incomes who are in work, offering one of the most generous savings bonuses available anywhere in the UK savings market, and is often overlooked by people who qualify. **Who is eligible** You can open a Help to Save account if you're receiving Working Tax Credit, or if you're claiming Universal Credit and you (with your partner if you have one, combined) had take-home earnings from work of at least a set minimum threshold in your last monthly assessment period (broadly equivalent to the earnings from working a set number of hours at National Living Wage level) -- the exact earnings threshold is set at a level intended to capture working claimants rather than those with little or no current earned income. **How the account works** You can save between £1 and £50 in total each calendar month into your Help to Save account (you don't have to save every month, and you can vary the amount), with a maximum total contribution of £2,400 possible if you saved the full £50 every month for the entire four-year life of the account. **The 50% government bonus** After two years, you receive a tax-free government bonus worth 50% of the highest balance you've ever reached in the account during that first two years. The account then continues for a further two years, and at the end of the full four years, you receive a second bonus, again 50% of the additional amount by which your highest balance increased during the second two-year period (compared with the highest balance at the end of year two). Save the maximum £50 a month throughout, and the two bonuses combined could total up to £1,200 -- an extremely generous return compared with any standard savings account. **You can withdraw money anytime, but it affects your bonus** Unlike a fixed-term account, you can withdraw money from your Help to Save account whenever you like -- but because the bonus is calculated on your HIGHEST EVER balance during each two-year period (not your current balance), withdrawing money reduces your running balance and could reduce your future bonus if you don't build the balance back up to the same high point again before the bonus calculation date. **Doesn't affect Universal Credit or tax credits** Savings held in a Help to Save account, and any bonus received, do not count towards the Universal Credit capital limit calculation or affect your tax credits award, meaning you can build up savings through this scheme without risking your ongoing benefit entitlement, which is a significant advantage over building savings in an ordinary account that could otherwise start to affect means-tested benefit calculations once balances grow. **How to apply** Help to Save accounts are opened directly through gov.uk (run by HMRC), and eligibility is generally checked automatically against your Universal Credit or tax credits record when you apply. **Practical tip** If you're eligible, even saving smaller amounts consistently (rather than the maximum £50) still earns the same generous 50% bonus rate on whatever your highest balance reaches, so it's worth opening an account and contributing what you can afford, even if it's well below the maximum.

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