State pensioners earning more than £35,000 a year will have to repay up to £600 in Winter Fuel Payments, as HMRC plans to recover two years' worth of payments within a single 12-month period from 2027. BBC Radio 4 Money Box journalist Dan Whitworth explained that the government will initially pay all eligible pensioners, then reclaim the money from those above the income threshold through the tax system.
From November, the Winter Fuel Payment will continue to be paid automatically to people aged 66 and over. However, a new income cap means those earning more than £35,000 will no longer qualify. Rather than withholding payments upfront, the government will pay everyone first and recover the money from high earners via HMRC. Around 2 million people are expected to be affected, with the average repayment being up to £300.
From 2027, the process changes: HMRC will collect two payments in one year—one to recover overpaid support from 2026 and another in advance for the 2027 payment. This could mean deductions of up to £600 across the year. For a typical £200 payment, HMRC will deduct approximately £17 per month, rising to £33 per month in the 2027-28 tax year, then returning to £17 per month.
Pensioners who are confident they will exceed the £35,000 threshold can opt out of receiving the 2026 Winter Fuel Payment from 1 April 2026 via gov.uk or mygov.scot, by phone, or by post. The deadline for opting out of the 2025-26 payment has already passed. Those who did not opt out and are over the threshold will have the money recovered through tax; they cannot return it themselves.
Most eligible people will receive a letter in October or November confirming their payment amount, with payments typically made in November or December 2025. A small number of people may need to submit a claim, including those who have deferred their state pension. Claims for winter 2025-26 must be made by 31 March 2026.
