How your benefits may be means-tested

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The amount of capital you have can affect your eligibility for means-tested benefits. The same limit applies for both single people and couples.

Pension Credit

For Pension Credit, there is no upper limit of capital above which you cannot claim the benefit. Savings or capital up to £10,000, and any income generated by those savings, are ignored. You will be treated as having ‘assumed income’ of £1 for every £500 (or part of £500) of capital you have above £10,000.

Housing Benefit and Council Tax Benefit

The lower capital limit for Housing Benefit and Council Tax Reduction is £10,000. If you have savings or capital of up to £10,000 these, and any income you receive from these savings, are ignored. You will be treated as having assumed income on capital above £10,000 as set out above.

Unlike Pension Credit, Housing Benefit and Council Tax Reduction also have an upper capital limit, which is £16,000. If you have more than this capital limit you will not be entitled to any Housing Benefit or Council Tax Reduction, unless you qualify for Pension Credit Guarantee Credit.

Valuation of capital

Your capital is generally assessed at its present-day value. If there would be expenses involved in selling your capital, 10% of its value will be deducted.
Any capital you own jointly with other people (besides your spouse, civil partner or partner) will normally be divided equally between the joint owners.

Capital taken into account

  • cash
  • money in bank or building society accounts, including current accounts that do not pay interest
  • National Savings accounts and certificates (there are special rules for valuing these)
  • income bonds
  • stocks and shares
  • property (other than your own home)
  • Premium Bonds
  • a share of any savings you own jointly with other people.

Income taken into account

Most income is taken into account when working out your entitlement to Pensions Credit Guarantee Credit, including:

  • pensions
  • earnings
  • income from annuities
  • most social security benefits
  • Working Tax Credit
  • assumed income from savings
  • income from boarders or sub-tenants
  • maintenance payments from a spouse or ex-spouse.

Your Age Scotland

Set your location to see what Age Scotland offers in your local area.

Age Scotland Helpline:
0800 12 44 222

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