Some Department for Work and Pension benefits come with a list of eligibility criteria they have to meet, sometimes including having less than a certain amount in savings. This includes Universal Credit, Tax Credits, Council Tax Support, Income-based Jobseeker’s Allowance, income-related Employment and Support Allowance, Income Support and Housing Benefit.

These are dubbed means-tested benefits and their savings requirements extend past the state pension age for Pension Credit, Housing Benefit and Council Tax Support. Each of these benefits have their own unique cap for savings.

Age UK notes that for Pension Credit there is no upper limit, meaning you likely won’t have the benefit completely stripped away due to building up a large amount of savings. However, the payments you get will begin to taper off proportionately if you have £10,000 or more in capital.

For every £500 you have over £10,000 it will be calculated as an extra £1 of income each week. In practice, this would mean having £12,000 in savings will see the DWP adding £4 to your income calculations which will push you towards the weekly income limit to claim Pension Credit which is £218.15 for singles and £332.95 for couples.

Similarly, for Housing Benefit and Council Tax Support, your payments will be reduced if you have between £10,000 and £16,000 in savings and investments. For people under the state pension age, the lower capital limit is £6,000.

Going above £16,000, regardless of your age, could see your Housing Benefit or Council Tax Support being taken away completely. Age UK highlighted though: “This rule doesn’t apply if you receive the Guarantee Credit part of Pension Credit.”

It’s also important to note that it’s not just the savings you have in the bank or in cash that count towards this limited sum. The DWP also includes the following in the calculation according to Age UK:

There are special rules for valuing National Savings accounts and certificates. If you delayed your state pension and received a lump sum as a result it is not included as part of the capital calculations.

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