Millions of Britons on low incomes are eligible to receive a substantial financial boost through HMRC's Help to Save scheme, which offers bonus payments of up to £1,200 over a four-year period. This government initiative, designed to encourage savings among those receiving Universal Credit or Working Tax Credits, provides a 50% bonus on monthly deposits, with contributions starting from as little as £1.
What Is the Help to Save Scheme?
Launched in September 2018, the Help to Save program was established to assist eligible individuals in building their savings by offering a generous government top-up. For every £1 saved per calendar month, participants can receive a bonus of 50p, calculated based on their highest saved balance. The scheme allows savers to deposit up to £50 monthly into a secure account, with a total potential deposit of £2,400 over four years.
Eligibility and Application Process
To qualify for a Help to Save account, you must be claiming Universal Credit and have earned a take-home pay of £1 or more during your most recent monthly assessment period. Additionally, applicants must be UK residents. For couples receiving joint payments, both partners can apply for separate accounts, maximizing their bonus potential.
Registration is conducted online through the GOV.UK website, requiring your National Insurance number or postcode, UK banking details, and two forms of identification, such as a valid UK passport or photocard driving licence.
How the Bonus Payments Work
The 50% bonus is distributed at the end of the second and fourth years of the scheme. After the initial two years, you'll receive a first bonus equivalent to 50% of your highest saved balance. Upon completion of the four-year term, a final bonus is awarded, representing 50% of the difference between the two amounts. If your highest balance remains unchanged, no final bonus will be granted.
HMRC has confirmed that your Help to Save account will close after four years, and you cannot reopen it or open another. However, you will retain all savings and bonuses accrued during the period.
Scheme Extension and Future Proposals
Originally set to conclude in September 2023, the Help to Save scheme was extended to April 2025 under the previous Conservative Government. There are ongoing proposals to make the program permanent and broaden eligibility criteria from 2028, potentially expanding access to more low-income individuals.
For further details, resources such as Martin Lewis' MSE website provide comprehensive explanations of the program, helping claimants navigate the benefits and requirements.
With approximately three million Universal Credit claimants currently eligible, this initiative represents a significant opportunity to enhance financial resilience and promote savings habits among those on limited incomes.
