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Change To Winter Fuel Payments

13 - 06 - 2025

The UK Government has announced it is reinstating the Winter Fuel Payment for 2025/26 in England and Wales.

On 09 June 2025 the UK Government announced that it was reinstating the Winter Fuel Payment for the 2025/26 winter in England and Wales.

 

Only those born before 22 September 1959 and living in England and Wales will be eligible. The benefit will also be restricted to those pensioners with a gross income of £35,000 or less.

 

The 2025/26 Winter Fuel Payment will be £200 per household which is increased to £300 per household where there is someone aged 80 or over.

 

In order to facilitate the payment all individuals over state pension age will be paid the non taxable benefit. Pensioners above the £35,000 threshold will then have the full amount they received automatically collected through their tax code and the PAYE system or via their self assessment tax return. No one needs to register with HMRC or take any further action.

 

Any overpayment will be recovered from individuals and household incomes will not be aggregated. This means that one pensioner in the household may have an income greater than £35,000 and lose the payment whilst their spouse may have an income below £35,000 and retain their payment.

 

Pensioners who want to opt out and not receive the payment will be able to do so once a system to opt out is established by the DWP.

 

Foremans LLP will be monitoring the roll out of the payments and reclaims and will keep clients informed of any changes including the opt out option.

 

Please do not hesitate to contact us if you wish to discuss any of the above further. We will be more than happy to help.

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Fixed Data

Assumptions

General                                                                                                                              

• The user is over 21 and subject to tax in the UK
• The user wishes to minimise their tax liability
• The user is subject to national insurance i.e.he/she is not over retirement age
• Only current tax rates and limits are applied
• No tax mitigation payments are made e.g. pension contributions
• Only 3 digit letter 'L' tax codes shown in the drop down list can be entered 
• The user does not have a turnover greater than £100,000 where fewer reliefs and or higher taxes may apply

Expenses

• All miles claimed as expenses are for business use using a personally owned car or van
• All other expenses claimed are wholly, necessarily and where appropriate exclusively for the benefit of the business

Foremans LLP Charges

• Foremans fees associated with Limited Company, Sole Trader or Umbrella are as per published rates
• Foremans current Service Costs are allowed for in all calculations.

Holiday Pay

• Holiday pay is accumulated week by week by Umbrella or Agency employer but paid out during the year

VAT

• Limited Company or Sole Trader will be VAT registered
• Limited Company or Sole Trader will take advantage of Flat rate VAT
• Flat rate applied includes the benefit of the additional 1% applicable to the first year of VAT registration

Limited Company Conditions

• One director / one shareholder in a Personal Service Company
• Director of Personal Service Company elects to vote for 100% dividend after salary, costs and expenses
• Director's salary is maximum salary to the primary threshold for NI
• The Limited Company is trading normally i.e it is not subject to IR35 and is not a Managed Service Company

NOTES

• The Current tax rates are taken from the Fixed Data Table
• The current Value Added Tax Rate is 20% and is applied to all invoices and expenses as appropriate
• The Director's Salary is fixed in relation to National Insurance thresholds. Higher Rate Taxpayers should consider the advantages and disadvantages of a larger annual salary or bonus
• Higher Rate Taxpayers may wish to consider the advantages and disadvantages of shared ownership of their business
• Users with a tax code other than three digits and letter "L" may telephone or email our Development Department to request a detailed calculation
• Generally the use of an Umbrella rather than an Agency payroll is only efficient if sufficient weekly expenses are allowable and claimed
• The expenses claimed under an Umbrella should not prevent the proper operation of National Minimum Wage