Introduction
Pension credit is a means tested benefit for people over the age of 60.
It has two elements-
Pension Credit Page Index
Introduction to Pension Credit
How income is calculated for Pension Credit
Calculating capital for Pension Credit
Only one member of a couple or civil partnership may claim for Pension credit.
Basic entitlement to Pension Credit
In order to get either Guarantee Credit or Savings credit;
Working out guarantee credit
The amount of guarantee credit that you will receive is the difference between your appropriate minimum guarantee and your weekly income (if the minimum guarantee is the greater amount).
When working out your income the Department of Work and Pensions will take into account any capital worth more than £6000 (£10,000 after November 2009). Every £500 above that amount adds £1 to your weekly income.
Your appropriate minimum guarantee consists of the standard minimum guarantee (currently £130 per week for a single person and £198.45 for a couple) plus any additional amounts that you may be entitled to.
An additional amount will be awarded if you are severely disabled or a carer (see bleow) or if you have eligible housing costs or have been claiming Jobseeker's Allowance or Income Support (see below).
Working out savings credit
Up to £20.40 per week (£27.03 for a couple) will be paid if your weekly income is less that £181 (£265 for a couple). If your income is less than £96 per week (£153.40 for a couple) you won't get savings credit but you should be entitled to guarantee credit.
The exact rate that you will be paid is based on percentages.
If you are single and your weekly income is worked out at above £96 but below £130 then you will receieve 60% of the difference between the two.
If your qualifying income is more than £130 then the £20.40 will be reduced by 40% of all income above £130 per week.
If you live with a partner and your joint income is more than £153.40 per week but less than £198.45 then you will receive 60% of the difference between the two.If, as a couple, if your qualifying income exceeds £198.40 then the £27.03 will be reduced by 40% of the difference between £198.40 and the total income. Some types of capital are disregarded or temporarily disregarded.
Some types of capital are disregarded or temporarily disregarded. See our "working out capital" pages for more details.
The lower rate of the savings credit threshold (currently £96 per week) is applied to individuals who have no partner and the higher rate (currently £153.40 per week) is applied to individuals who have a partner. £198.45 per week is applied to claimants who are in a polygamous relationship.
The Pension Service provides an online calculator to help people to estimate how much pension credit you may be entitled to. The calculator won't cover everyone's circumstances you should ring 0800 99 1234 if this applies to you.
Disability Alliance points out that Pension Credit does not include any additional amounts for children and advises that people with children should apply for child tax credit instead.
Being severely disabled
This additional amount is paid at two rates- lower (£52.85 per week) and higher (£105.70 per week). If you are single, in order to qualify for the lower rate you need to show that;
If you have a partner you will be awarded the lower additional amount if;
Being a carer.
You will be awarded the additional amount for carers (currently £29.50 per week) if you are entitled to Carer's Allowance. If both you and your partner are entitled to Carer's Allowance then you will be awarded £59 per week.
You do not need to be receiving Carer's Allowance- it may be that you are entitled to CA but can't receive it because of the overlapping benefit rules.
Additional amounts if you have been claiming Income Support, income based Jobseeker's Allowance or income related Employment and Support Allowance.
An amount is added to your appropriate minimum guarantee if you were claiming any of the above benefits immediately before receiving pension credit.
The additional amount that you will be awarded will depend on your personal circumstances. Essentially this is the difference between the applicable amount you are awarded with either IS, ESA or JSA (less any allowances for dependants, Residential Allowance, Family Premium, Disabled Child Premium and Disablity Premium) and the amount of your appropriate minimum guarantee.
