HMRC giving £1,200 bonus to people with savings through Help to Save scheme

03 November 2023 , 10:48

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Help to Save is a Government savings account (Image: Getty Images)

Thousands of people on Universal Credit and Tax Credits can get a £1,200 bonus through a specific savings account.

Help to Save is a Government savings scheme for low-income earners and offers savers a 50% bonus payment on their savings, up to £1,200. You can save between £1 and £50 each month and for every £1 deposited, you get 50p back - this means you're getting a 50% return on your money.

The account lasts four years and bonuses are paid in the second and fourth years of the account being opened. Savers who deposit the maximum £50 each month will have saved £2,400 over the course of the four years and will receive a bonus of £1,200 from the Government.

You can save less and still get a bonus, although it will be a lower amount - for example, save £25 a month over two years and you'd get £600 back. You can open a Help to Save account if you claim:

• Universal Credit and you (with your partner, if it is a joint claim) had take-home pay of £722.45 or more in your last monthly assessment period

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• Working Tax Credit

• Child Tax Credit if you’re entitled to Working Tax Credit

Victoria Todd, Head of the Low Incomes Tax Reform Group, said: “For those who are able to take part, the Help to Save account is a very attractive savings scheme, especially when the saver is able to maximise their bonuses. They can do this by paying in the maximum amount each month and making no withdrawals.

“Those who are eligible can still get bonus payments, even if they can’t save the maximum. That is why we recently welcomed the extension of the scheme to April 2025.”

How to open a Help to Save account

You can apply for a Help to Save account through the Gov.uk website or by calling 0300 322 7093. You and your partner can both open separate Help to Save accounts if you receive payments as a couple.

If you have savings elsewhere, having a Help to Save account could potentially see your benefits reduced if you go over a certain threshold. If you claim Universal Credit or Housing Benefit, you and your partner can have up to £6,000 in personal savings - above this amount, and your benefits could be reduced.

This would include any savings in your Help to Save account. Any savings or bonuses you earn through Help to Save will not affect your Working Tax Credit.

Levi Winchester