HMRC Encourages Universal Credit Recipients to Claim £1,200 Savings Boost

People receiving Universal Credit are being urged by HM Revenue and Customs (HMRC) to check their eligibility for the Help to Save scheme, which offers a potential cash boost of up to £1,200. This initiative is designed to encourage savings among individuals who may struggle financially, providing them with a government-backed incentive to save.

The Help to Save scheme allows participants to earn 50 pence for every £1 saved over a period of four years. Individuals can contribute as much as £50 each month, totaling a maximum deposit of £2,400 throughout the entire duration. By meeting this monthly limit, participants can receive a £25 bonus. The overall potential payout, including bonuses, can reach an impressive £1,200.

Understanding the Benefits of Help to Save

The scheme is structured to reward consistent saving. Two tax-free bonuses are disbursed during the four-year period: the first occurs at the end of the second year, and the final bonus is given at the end of the four years. These bonuses are determined by the highest balance saved in the account, with HMRC explaining that if the highest balance does not increase, no final bonus will be awarded.

In a recent message on X (formerly Twitter), HMRC highlighted the importance of the scheme, stating: “Do you claim Universal Credit? If so, you may be eligible for a savings boost. With Help to Save, for every £1 you save, the Government adds 50p. That’s up to £1,200 in bonus payments over four years. Check eligibility and apply today via the HMRC app.”

Setting up an account is a straightforward process, taking less than five minutes. Participants can manage their accounts easily through the GOV.UK website or the HMRC app, where they can check their balance, view bonus details, and make deposits using debit cards, bank transfers, or standing orders. While funds can be withdrawn at any time, it is important to note that withdrawing money may affect the bonus payments.

Wider Impact and Extension of the Scheme

According to HMRC, over half a million people are currently positioned to benefit from the Help to Save scheme. The government recently extended the program to April 2027, allowing even more individuals working while receiving Universal Credit to open accounts. This extension ensures that those who contribute £50 per month can still receive a £25 bonus, further emphasizing the government’s commitment to supporting low-income earners.

As financial pressures continue to impact households, schemes like Help to Save play a crucial role in promoting financial stability and encouraging a culture of saving. With the potential to earn significant bonuses, individuals are encouraged to take advantage of this opportunity to enhance their financial security.