HMRC Offers an Additional £1,200 to Universal Credit Recipients for a Single Action

For individuals with limited income, setting aside savings can often feel like a daunting task due to minimal disposable income. However, many are unaware of the “Help to Save” program, a valuable initiative by HMRC designed to encourage saving among those on lower incomes or receiving benefits. This scheme offers a substantial financial incentive, potentially augmenting savers’ balances by up to £1200.

“Help to Save” is tailored for low-income individuals, enabling them to deposit up to £50 monthly into a specialized savings account. Unlike certain savings accounts that deter withdrawals by reducing interest, this program allows flexible access to funds without forfeiting the generous bonus. The bonus, paid biennially, equals 50% of the highest balance achieved within the account, encouraging consistent saving practices, reported Manchester Evening News.

Eligibility extends to those receiving Universal Credit with a minimum income threshold, as well as select recipients of working or child tax credits. Importantly, the account remains operational and bonus-eligible even if the saver’s income subsequently exceeds the qualifying threshold for benefits.

The program’s structure promotes a gradual build-up of savings, with the government rewarding savers with a bonus of up to £600 after the initial two years, based on the account’s peak balance. Continued saving in the subsequent two years can lead to an additional £600 bonus, contingent upon the new highest balance minus the previous peak.

Despite its potential, the “Help to Save” scheme remains underutilized, with a significant number of eligible individuals not taking advantage of this opportunity. As the deadline to open an account is set for April 2025, those eligible are encouraged to explore this option to enhance their financial resilience. Applications can be made online through the gov.uk website or by contacting HMRC directly for assistance.