Tax Deadline to opt out of Winter Fuel Payments

If, as a pensioner, your total income is over £35,000, HMRC will take back your Winter Fuel Payment through your tax code unless you act now.

HMRC has set a cut-off date of 15 September 2025 for pensioners to opt out of Winter Fuel Payments to avoid tax clawback of the entire amount.

After the Chancellor U-Turned on Winter Fuel Payments for the 2025-26 winter period, new rules came into place which mean only pensioners with less than £35,000 in total income for tax purposes will qualify for the benefit in the future, and there are crucial opt out provisions.

The final deadline for pensioners to tell HMRC they do not want the payment is Monday 15 September 2025. If the threshold of £35,000 is exceeded by just £1, the whole amount will be clawed back by HMRC, so it is really important to take action, warned tax experts at ICAEW.

Pensioners in England, Wales and Northern Ireland can opt out by filling in an online form or by writing to or calling HMRC by the deadline.

Opting out is important for anyone above the heating benefit’s threshold, as otherwise the amount will be clawed back through the tax code system. The payment is worth between £100 and £300, depending on age.

Anyone with pension age family members or clients should check urgently whether they want to opt out to ensure they do not receive a surprise tax bill next summer. They can opt out online or phone the Winter Fuel Payment Centre on 0800 731 0160 and select Option 2.

HMRC has set up an online tool to check eligibility and tax status to help with the initial decision whether to opt out. This asks for details of the pensioner’s taxable income, including pensions, both state and personal, dividends, rental income, state benefits etc.

Before using the online tool, make sure to have the pensioner’s total amount of state and personal pension payments, calculated to the nearest pound, for the period 6 April 2025 – 5 April 2026.

The tool calculates eligibility and then, if you qualify, gives you the choice to opt out.

HMRC Online Tool: Check if HMRC will take back your Winter Fuel Payment: https://www.gov.uk/winter-fuel-payment

Winter Fuel Payment Telephone: 0800 731 0160

Article extracted from Business & Accountancy Daily, 12 August 2025