Winter Payments 2025: What Pensioners Need to Know

Winter Payments 2025: What Pensioners Need to Know – and How to Opt Out (deadline 12-14 September 2025)

Important changes have been announced to Winter Fuel Payments for 2025. From this winter, all eligible pensioners will automatically receive a it, but for those with higher incomes, the amount will be clawed back via the tax system.

We have summarised the key details below, along with information about how to opt out of receiving the payment if you expect to be affected by the tax recovery rules.

Who Will Receive the Winter Payment in 2025?

Most pensioners born before 22 September 1959 are eligible to receive a Winter Payment in 2025.

You do not need to apply – payments will be made automatically, typically between November and January.  If you asked to apply, this will be a scam.

Payment Amounts for England:

Between £100 and £300

The exact amount depends on your age and household circumstances.

Clawback for Pensioners With Higher Incomes

If your total taxable income in the 2025/26 tax year exceeds £35,000, HMRC will recover the full amount of your Winter Payment via the tax system.

Even £1 over the threshold will result in a full clawback — there is no tapering.

It is our understanding from the wording used that the income test will be based on gross taxable income, with no deduction for pension contributions or Gift Aid donations.

How HMRC Will Recover the Payment:

Self-Assessment Taxpayers will repay this through Self Assessment.

For those pensioners who do not file Self-Assessment Tax Returns, HMRC will adjust PAYE tax codes in 2026/27 to recover the amount but it is envisaged that from April 2027, the clawback will occur in the same tax year the payment is made.

Can I Opt Out?

Yes. If you are sure your income will exceed £35,000, and would prefer to avoid the payment being recovered via tax, it is possible to opt out of receiving the Winter Payment for 2025.  If you are not absolutely sure if your income will be over £35,000 it is safer not to opt out as you can only opt back in until 31 March 2026, probably before you know the exact amount of your income in the 2024/25 tax year.

How do I Opt Out of the Winter Payment?

Details of how to opt out can be found by clicking on this link on Gov.uk

• Complete an online form by 14 September

• Call the helpline before 6pm on 12 September 2025 -  0800 731 0160

If you are unsure whether you should opt out, just get in touch as would be happy to review your income position and advise on whether opting out is suitable for you.

Final Thoughts

While receiving the Winter Payment sounds beneficial, higher-income individuals may find it simpler to opt out rather than deal with tax clawback later.

If you want any more information, please do not hesitate to get in touch.  We are here to help.

Written by:  Heather Langtree, director