Basics of benefits

Maximising your income can make a real difference when you’re trying to manage your money and make sure you can pay all your bills.

It is important to realise that financial benefits are not all means-tested and related directly to your income and savings. Many are based on your individual National Insurance record and some are based on your personal circumstances, without any reference to your finances.

This guide to the main financial benefits available to those both over and under State Pension Age provides further information about what you may be entitled to.

Benefits for people over State Pension Age

Pension Credit

An income-related benefit for single people or couples over State Pension age. There are two types of Pension Credit and you may be eligible for one or both. Guarantee Credit tops up your income to the minimum guarantee levels set by the Government each year. Savings Credit is an extra payment available to some people who made extra provision for retirement, if they reached State Pension age before 6 April 2016. 

Attendance Allowance 

A non-means tested benefit for people over State Pension Age, that looks at an individual, any illnesses or conditions they may have and their personal care needs. For example, difficulties with washing and bathing or walking around in your own home. Attendance Allowance is not payable if you already receive a disability benefit like Disability Living Allowance or Personal Independence Payment. 

Housing Benefit

A means-tested benefit that can help people who are renting or living in a shared ownership property. If you receive Pension Credit Guarantee, then you will be entitled to full Housing Benefit, but you may also qualify based on a low income. Housing Benefit looks at your income and savings and is based on the amount of rent you pay and any eligible service charges. 

Council Tax Reduction

A means-tested benefit that can reduce the amount of council tax you have to pay each year. This benefit looks at your income and savings, it won’t be paid to you but if you are eligible, it will reduce the amount you have to pay. 

Benefits for people under State Pension Age 

Universal Credit

An income-related benefit for individuals or couples under State Pension Age. Couples with one person under State Pension Age and one person over State Pension Age may also be asked to claim Universal Credit. 

Universal Credit can be paid to those in work, those unable to work due to illness and those who are looking for work. It can include an amount for help with rent, an amount for you as a single person or as a couple an amount for children. There can also be extra amounts payable if you have an illness impacting your ability to work or you are a carer. 

Council Tax Reduction

A means-tested benefit that can reduce the amount of council tax you have to pay each year. This benefit looks at your income and savings, it won’t be paid to you but if you are eligible, it will reduce the amount you have to pay. 

New Style Employment and Support Allowance

A non-means tested benefit, which can be payable to an individual who cannot work due to illness. There are conditions linked to your National Insurance record and you do need to be able to provide a fit note from your doctor for this claim. 

New Style Jobseeker’s Allowance

A non-means tested benefit, which can be payable to an individual who is looking for working. There are conditions linked to your National Insurance Record and the length of time you can claim this benefit for is limited to 6 months. 

Personal Independence Payment (PIP)

A non-means tested benefit for an individual who has difficulty with their daily living and/or mobility needs. For example, difficulty with eating and drinking, dressing and undressing or walking short distances. 

Some working age benefit claimants may also be receiving ‘old style’ benefits such as Income-related Employment and Support Allowance, Income-related Jobseeker’s Allowance, Income Support, Tax Credits and Housing Benefit.