HMRC warning for state pensioners – act to avoid £33 charge | Personal Finance | Finance
Pensioners with incomes of £35k or more should opt out of the Winter Fuel Payment, an expert says (Image: Getty)
State pensioners have been warned they may have to pay £33 per month to HM Revenue & Customs (HMRC) if they don’t act soon. Consumer expert, Rebecca Wilcox, said individuals whose annual personal income exceeds £35,000 should opt out of the Winter Fuel Payment for the next year to avoid having to pay it all back.
She said this can’t be done until April 1, but those drawing the State Pension who are over the threshold will want to do so as the payments are set to double for a year. HMRC confirmed it will be collecting payments received in both winter 2026 and 2027 during the tax year 2027-28.
READ MORE: Martin Lewis issues ‘not great’ update ahead of energy price cap surge
READ MORE: Three booking mistakes that can make holidays ‘cost more’
Those likely to be affected are pensioners with a total annual income of £35,000 or more who receive a Winter Fuel Payment, or Pension Age Winter Heating Payment in Scotland.
HMRC is introducing the new charge, which is equal to the full value of a Winter Fuel Payment or Pension Age Winter Heating Payment. It applies to the whole of the UK.
The taxman will automatically collect payment for pensioners via PAYE tax codes unless they already file a Self Assessment tax return.
For the 2026-27 tax year, for a typical winter payment of £200, about £17 per month will be deducted from a PAYE customer, according to HMRC.
In the tax year 2027-28, deductions will temporarily rise to about £33 per month for a typical £200 payment. This is due to HMRC recovering payments for both the 2026 and 2027 winter payments in the tax year 2027-28.
Our community members are treated to special offers, promotions, and adverts from us and our partners. You can check out at any time. Read our Privacy Policy
HMRC said the measure helps its transition to in-year recovery of payments, which it said falls in line with normal PAYE practice.
From the tax year 2028-29 onwards, deductions are expected to return to about £17 per month.
The move comes after the Government U-turned on its policy of only paying Winter Fuel Payments to people on means-tested benefits.
After a huge backlash, this was expanded from last winter to all pensioners whose total incomes fall below or are equal to £35,000.
This was in addition to the charge for individual pensioners with total annual incomes over £35,000. The qualifying amount does not include a partner’s income.
Ms Wilcox said pensioners who know they are going to earn £35,000 or more might want to opt out.
Speaking on the BBC, she added: “If your income then drops, just be aware you will have to opt back in to receive the Winter Fuel Payment.”
The Winter Fuel Payment amounts to between £100 and £300. Its aim is to help people who were born before June 28, 1960, with their heating bills.
If you are eligible for it, you will receive a letter in October or November which details how much you will get.
The amount you receive depends on when you were born and what your circumstances are during the “qualifying week” – which this year is September 21-27.
Most people get the Winter Fuel Payment automatically if they are entitled to it.
People on a number of benefits do not need to claim. These include the State Pension, Pension Credit, Universal Credit, Attendance Allowance and Personal Independence Payment, among others.
More information about how to claim and to check if your income will be over £35,000 is available at the Gov.uk website.
