Many Universal Credit claimants may not be aware of this DWP scheme
New data from the Department for Work and Pensions (DWP) reveals that there are now 8 million people claiming Universal Credit. Yet, many working claimants might not realise they could be eligible for a unique bonus of up to £1,200 to bolster their savings and help build financial resilience for the future.
Thanks to a rule change at the start of the new financial year, some 3 million Universal Credit claimants are now eligible for the ‘Help to Save’ scheme. The extension of the scheme until April 2027 means more low-income people can benefit from the scheme, which has already paid out millions in bonuses to over 500,000 people since its launch in 2018.
A huge 93 per cent of scheme users have deposited the maximum £50 every month into their Help to Save account. Setting up an account takes just a few minutes – you don’t need to deposit any money straight away – and it can be easily managed through GOV.UK or the HMRC app, making it accessible to people across the UK, reports the Daily Record.
Savers who deposit the maximum amount of £2,400 over four years (£50 per month) will receive a bonus totalling £1,200 into their bank accounts, with payments made at the end of the second and final year.
Here’s a quick rundown of Help to Save
The Help to Save scheme is a way for people to save between £1 and £50 each month, with an added bonus of 50p for every £1 saved. This bonus is paid out in the second and fourth years after the account has been opened. You can withdraw money at any time, but keep in mind that this could affect your 50% bonus payments. The bonus is calculated based on the highest amount held in the account.
With the app, you can easily view your account, check your balance and bonus details, and make deposits via debit card, bank transfer or standing order. Even if you’re not in a position to save money right now, it’s worth opening an account while you’re eligible, as there’s no requirement to deposit any money immediately.
Here’s how the payments work
You have the flexibility to save between £1 and £50 each calendar month – there’s no obligation to pay in every month. Payments can be made by debit card, standing order or bank transfer.
You can make deposits as often as you like, but remember, the maximum you can pay in each calendar month is £50. Withdrawals from your Help to Save account can only be made to your bank account.
Here’s how the bonuses work
Bonuses are awarded at the end of the second and fourth years, and they’re based on how much you’ve saved.
For example:
If you manage to save £50 each month for the first two years (a total of £1,200), your first bonus payment would be £600. You could even withdraw all of it, but you’d need to wait until the 24th month or the bonus payment would be less.
Likewise, if you add £50 for the following two years, you’ll receive another £600 bonus. This means that in total, you could get a free £1,200 and if you kept the money in for the entire four years, you’d pocket an impressive £3,600 when the account closes.
What happens after four years?
Your Help to Save account will shut four years after you’ve opened it. You won’t be able to reopen it or start another Help to Save account. You can close your account whenever you want. If you close your account early, you’ll miss out on your next bonus and you won’t be able to open another one.
Eligibility
You’re eligible to open a Help to Save account if you’re on Universal Credit and you (along with your partner if it’s a joint claim) had a take-home pay of £1 or more in your last monthly assessment period. Your take-home pay is what you earn after deductions (like tax or National Insurance).
If you receive payments as a couple, both you and your partner can apply for your own Help to Save accounts. You need to apply individually.
You also need to be residing in the UK. If you live abroad, you can apply for an account if you’re either a:
- Crown servant or their spouse or civil partner
- member of the British armed forces or their spouse or civil partner
If you stop claiming benefits
You can keep using your Help to Save account.
Will it affect my benefit payments?
You can still receive Tax Credits or Universal Credit while saving with Help to Save. For further information and to set up your Help to Save account, visit the GOV.UK website here.