what is Pension Credit?

The maximum basic state pension you can qualify if you’re a single person is £84.25 a week, or if you’re a couple, £134.75 a week. However, this is below the minimum level the government thinks pensioners should live on. This is called the minimum guarantee. The minimum guarantee in 2006-7 is £114.05 a week for a single person and £174.05 for a couple. If your income is lower than that you can claim pension credit to bring your income up to that minimum level.

Pension Credit is a tax-free entitlement for people aged 60. You do not need to have paid National Insurance contributions to be eligible.

There are two parts to Pension Credit: the guarantee credit and the savings credit.

• The guarantee credit provides financial help for people aged 60 or over whose income is below a certain level set by the law.
• The savings credit is an extra amount for people aged 65 or over who have made some provision for their retirement (such as savings or a second pension) which brings their income above a level called the savings credit starting point. You can get a savings credit on top of a guarantee credit.

From 2010, the age from which people can get Pension Credit will change in line with the change to women’s State Pension age.