A change in the rules mean that people who earn more than £35,000 will have to pay back 2 years worth in just 12 months
BBC Radio 4 Money Box Journalist Dan Whitworth has revealed that HMRC is poised to reclaim £600 from state pensioners ‘in just one year’ of winter fuel payments. Speaking on BBC Morning Live, he explained that individuals earning over £35,000 annually will be required to repay the winter fuel payments via tax reclamation by HMRC.
Those with a taxable income exceeding £35,000 will need to return the money, leading many to simply opt out to sidestep the hassle. Commenting on the requirement to repay the £300, Mr Whitworth stated: “This story, widely reported, relates to upcoming changes to the Winter Fuel Payment (known as the Pension Age Winter Heating Payment in Scotland).”
“From November, the payment will continue to go automatically to people aged 66 and over to help with heating costs. “hat’s changed is the introduction of a new income cap. Those earning more than £35,000 a year will no longer qualify.
“Rather than withholding payments upfront, the government will pay everyone first and then recover the money from those over the threshold through the tax system. Around 2 million people are expected to be affected, and the average amount to be repaid will be up to £300.”
“”That money will not be taken from bank accounts. Instead, HMRC will reclaim it through tax.”
There are two ways in which the money will be reclaimed:
- Pay As You Earn (PAYE) – where the sum is deducted monthly from your salary or pension income.
- Self Assessment – for those who file tax returns, the amount will be added to the following year’s tax bill
However, a planned change will see HMRC reclaiming two years’ worth of payments in just 12 months. Mr Whitworth stated: “From 2027, the process will change again. HMRC plans to collect two payments in that year, one to recover overpaid support from 2026 and another in advance for the 2027 payment, meaning some people could see deductions of up to £600 across the year.
“The government says this approach helps avoid delays in recouping overpayments and ensures the system stays up to date.”
A spokesperson for HMRC told BBC Morning Live: “For PAYE customers, for a typical payment of £200, we’ll deduct approximately £17 per month. In the 2027 to 2028 tax year, we’ll deduct approximately £33 per month for a typical payment of £200. This is because we’ll be collecting payments from 2026 and 2027. It will then return to approximately £17 per month for the 2028 to 2029 tax year.
“If you are confident that you will breach the £35,000 income threshold then you have the option to opt out of receiving the 2026 Winter Fuel Payment. Details of how to opt out can be found at gov.uk or mygov.scot from April 1st 2026. You’ll also be able to do this by phone or by post.”
The majority of individuals will automatically receive the Winter Fuel Payment without needing to take any action. However, a small number may need to apply for it, such as those who have deferred their state pension since their last Winter Fuel Payment.
The correct method to apply is by post now, or over the phone.
How to claim the winter fuel payment
Claim by post
Fill in a Winter Fuel Payment claim form and send it to the Winter Fuel Payment Centre.
Winter Fuel Payment Centre Mail Handling Site A Wolverhampton WV98 1LR
Claim by phone
Call the Winter Fuel Payment Centre to claim by phone.
Winter Fuel Payment Centre Email enquiry form Telephone: 0800 731 0160 Relay UK (if you cannot hear or speak on the phone): 18001 then 0800 731 0160 British Sign Language (BSL) video relay service if you’re on a computer – find out how to use the service on mobile or tablet
The deadline to make a claim for winter 2025 to 2026 is 31 March 2026.
If the person’s income is over £35,000, HMRC will take the Winter Fuel Payment back through tax subsequently. People can check if their income is over the threshold and how HMRC will take it back.
Those eligible, should get a letter in October or November saying how much they’ll get. Most eligible people will be paid in November or December 2025.
For more information visit Gov.UK
If you want to opt out of getting the Winter Fuel Payment
The deadline for opting out of the Winter Fuel Payment for 2025 to 2026 has passed.
If your income is over £35,000 and you did not opt out, HMRC will take your Winter Fuel Payment back. You cannot return it yourself. You can check how HMRC will take it back.
You can opt out of getting the Winter Fuel Payment for 2026 to 2027 onwards from 1 April 2026.
