HMRC has issued an urgent reminder to Britons on a low income that they can boost their savings by as much as £1,200 over four years through the Government-backed Help to Save scheme. The account, available to certain people receiving Universal Credit, offers a “bonus of 50p for every £1 they save over 4 years”, according to the GOV.UK website.
How the scheme works
With the account, people on Universal Credit can save between £1 and £50 each calendar month, paid in by debit card, standing order or bank transfer. It does not need to be every month, though the maximum amount you can pay in is £50 per calendar month. If the maximum were paid in each month across the whole four years, it would amount to £2,400 over four years.
Rather than interest, bonuses are paid out at the end of the second and fourth years based on the amount saved, the website says. This would give a bonus of £600 after two years, and another after four years (£1,200 in total).
Final bonus rules
After four years, savers get a final bonus, provided they continue to save. The GOV.UK website explains this final cash boost will be 50% of the difference between two amounts: the highest balance saved in the first two years (years one and two) and the highest balance saved in the last two years (years three and four). This means if you withdraw cash, you will need to make it up before you can maximise the bonus reward across the four years. If your highest balance does not rise through continued saving, you will not earn a final bonus.
You can close your account at any time during the four-year period, but you will miss out on your next bonus if you do, and you will not be able to open another one. It is a one-time thing, as after four years you get the money from your account, which is closed for good, and you cannot open another one after that.
Eligibility and reminder
You can open a Help to Save account if you are in receipt of Universal Credit and you (with your partner if it is a joint claim) had take-home pay of at least £1 in your last monthly assessment period, the Government website says. Other eligibility criteria apply.
HMRC issued a reminder about the savings account on X on Monday, September 21, writing: “Looking for a simple way to boost your savings? More than £300 million in bonus payments has been paid out through Help to Save. This #UKSavingsWeek, see if you could benefit too. It only takes a few minutes to check your eligibility and open an account online.”
