HM Revenue and Customs (HMRC) has confirmed automatic tax charges of around £33 extra per month for state pensioners with an annual income of more than £35,000 who receive a Winter Fuel Payment. The money will be clawed back via a tax code change, meaning pensioners will pay additional tax every month until the payment has been recovered.
How the repayment works
Winter Fuel Payments are worth between £100 and £300 per household. For a typical payment of £200, pensioners above the £35,000 threshold will face extra tax of about £17 per month in the 2026 to 2027 tax year, rising to around £33 per month in the 2027 to 2028 tax year, unless they opt out of receiving the payment.
HMRC has already begun reclaiming payments for the 2025 to 2026 tax year and sent out letters or email notifications to pensioners confirming a change in tax code in April. Those in Self Assessment who file online should find the payment pre-populated in their 2025 to 2026 tax return, due by January 31, 2027. Paper filers must add it to their return by October 31, 2026.
Opt-out options
Pensioners who wish to avoid the extra tax can opt out of the Winter Fuel Payment. They must complete an opt-out form by 11.59pm on September 20, 2026, or call the Winter Fuel Payment helpline before 6pm on September 18, 2026.
The automatic recovery applies across the whole of the UK, including Scotland (where the payment is known as the Pension Age Winter Heating Payment) and Northern Ireland (where payments were made by the DWP on behalf of the Northern Ireland Executive). In all cases, HMRC handles the recovery.
HMRC scam warning
With recovery underway, HMRC last month warned pensioners to be on “high alert” for scams, stating that it will never contact people by text or email to ask them to repay their Winter Fuel Payments or to request bank details.
Myrtle Lloyd, HMRC’s Chief Customer Officer, said: “Criminals are great pretenders and often use fake letters, emails, calls and texts to impersonate HMRC and trick people into giving them money. I’d encourage anyone who’s unsure to use our online tool at GOV.UK to check whether and how their payment will be recovered – there’s no need to call us.”
