Glossary · UK
What is Pension Credit Savings Credit?
An extra Pension Credit payment rewarding people who reached State Pension age before 6 April 2016 for having modest retirement savings or income.
Full Definition
Savings Credit is one of the two parts of Pension Credit, the other being Guarantee Credit. It provides a small top-up to people who built up some retirement provision of their own, such as savings or a private or workplace pension, on top of their basic State Pension. Crucially, Savings Credit is only available to those who reached State Pension age before 6 April 2016; anyone reaching State Pension age on or after that date cannot make a new claim, so it is a closed legacy benefit that fewer people qualify for each year. It works by paying a proportion of income above a savings threshold, up to a weekly maximum, and the amount tapers away as qualifying income rises. Because the rules interact with the basic State Pension (around £241.30 per week for the New State Pension, though Savings Credit recipients are typically on the older basic system), the calculation is means-tested and depends on individual circumstances. Receiving any Pension Credit can passport you to other help, including Housing Benefit, Council Tax Reduction and a free TV licence at age 75. Pension Credit is a reserved benefit administered consistently across England, Scotland, Wales and Northern Ireland, though Council Tax Reduction and rates support schemes differ by nation.