The Department for Work and Pensions (DWP) has issued a fresh alert to millions of UK pensioners, warning that those born on or before September 22, 1960 and earning above £35,000 annually will have their Winter Fuel Payment reclaimed through the tax system. This means the money could arrive in bank accounts only to be recovered later by HM Revenue and Customs (HMRC).
Opt-Out Deadlines and Procedures
Pensioners who wish to avoid receiving the payment altogether must take action before two key September deadlines. The DWP has outlined two opt-out methods: completing the official online opt-out form by 11:59 pm on September 20, 2026, or contacting the Winter Fuel Payment helpline by 6 pm on September 18, 2026. Claimants will need their National Insurance number when submitting the request. The DWP emphasised that people cannot simply repay the money themselves once it has been issued; instead, HMRC will retrieve it automatically through the tax system from those whose annual income surpasses £35,000.
Automatic Opt-Out and Reinstatement
The opt-out choice extends beyond this winter. Anyone who opts not to receive the payment will automatically remain opted out in subsequent years unless they contact the Winter Fuel Payment Centre to opt back in. Those wishing to receive the payment again must inform the DWP by March 31, 2027, if they want to be included for the 2026-27 winter payment. The department is also urging pensioners to report any changes in their circumstances as soon as possible, such as relocating, moving into a care facility, or any other situation that might impact eligibility. Authorities caution that providing inaccurate details could result in claimants being forced to repay funds if they've received too much.
Background: Labour's U-Turn
This latest warning follows one of Labour's most contentious policy reversals. In July 2024, Chancellor Rachel Reeves limited Winter Fuel Payments to pensioners claiming Pension Credit or certain other means-tested benefits, calling it a "tough choice" made to help repair the public finances. The move triggered intense political criticism, with charities cautioning that millions of elderly people would be forced to choose between staying warm and buying food throughout winter. Labour MPs also raised concerns that numerous low-income pensioners were losing out because they qualified for Pension Credit but had never applied.
Under growing pressure, the Government backtracked in June 2025, announcing that Winter Fuel Payments would be restored to all pensioners over State Pension age across England and Wales, without requiring them to claim a qualifying benefit. However, the revived scheme introduced a fresh stipulation: pensioners earning more than £35,000 annually would still receive the payment upfront, but HMRC would subsequently claw back the entire sum via the tax system.
Campaign Group Concerns and DWP Advice
Campaign groups have maintained that this arrangement risks causing widespread confusion among elderly recipients, many of whom may be unaware the payment could ultimately push up their tax liability. As September deadlines draw closer, the DWP is encouraging anyone who thinks they could be affected to check their situation now, rather than face an unpleasant shock later in the year. Pensioners seeking further details can contact the Winter Fuel Payment Centre on 0800 731 0160, available between 8 am and 6 pm, Monday to Friday, via the Relay UK service, or by writing to the Winter Fuel Payment Centre, Mail Handling Site A, Wolverhampton, WV98 1LR.
