Inheritance, lump sums and benefits
The savings you have might affect means-tested benefits you receive. Your savings could increase if you inherit:
cash property stocks and shares
Or they could increase because you get a lump sum from:
a compensation payment or insurance claim dividends from shares or bonds a private or work pension redundancy pay
How savings affect your benefits depends on:
if you are under or over State Pension age the type of benefits you claim how much you have in savings What counts as savings Use a calculator to see if your savings affect your benefits. Benefits affected by savings
Your savings affect means-tested benefits. These are benefits based on your savings and income. These include:
Universal Credit Income-based Jobseeker’s Allowance (JSA) Income-related Employment and Support Allowance (ESA) Income Support Pension Credit tax credits (Child Tax Credit and Working Tax Credit) Housing Benefit Council Tax Support Benefits not affected by savings
You need to let the relevant benefits office know if your savings increase. If you do not, you could be:
fined paid too much which you may have to pay back How to report a change in your circumstances (GOV.UK) Saving limits
The DWP sets a limit of £16,000 in savings to be eligible for:
Universal Credit Income-based JSA Income-related ESA Income Support Housing Benefit if you’re under State Pension age
If your savings are:
under £6,000, your benefit claim is not affected by your savings between £6,000 and £16,000, you lose some of your benefit payment more than £16,000, you’re not eligible
Every £250 over £6,000 counts as if you had:
£4.35 of monthly income for Universal Credit £1 of weekly income for Income-based JSA, Income-related ESA, Income Support and Housing Benefit Housing Benefit
The rules for Housing Benefit are different if you’re over State Pension age.
You can have up to £10,000 in savings before it affects your claim. Every £500 over that amount counts as £1 of weekly income.
If you get Pension Credit guarantee credit, you can have more than £16,000 in savings without it affecting your claim.
If you claim Housing Benefit jointly with someone who is below State Pension age, the working age savings limit of £6,000 applies before it affects your claim.
These limits do not apply to tax credits. What you’re entitled to is based on your income last year, which includes interest on savings.
What counts as income for tax credits (GOV.UK) Check if a change affects your tax credits (Citizens Advice) Pension Credit
The rules are different for Pension Credit. The first £10,000 does not count. But every £500 over that amount counts as £1 of income. There is no upper savings limit for Pension Credit.
Use the Pension Credit calculator to see if you’re eligible.
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