Taxing and opting out of Winter Fuel Payments –
In the UK, Winter Fuel Payments (WFP) are typically made to pensioners to help with heating costs. However, starting from winter 2025/26, there are new rules and guidance on how winter fuel payments will be recovered from wealthier pensioners.
Tax clawback for Higher Incomes
- If your taxable income exceeds £35,000, HMRC will claw back the WFP through the tax system.
- This applies even if your income exceeds the threshold by just £1.
- Recovery is done via:
- PAYE tax code adjustment for non–self-assessment taxpayers.
- Self-assessment tax return inclusion for those who file one.
Opting Out of the Payment
- You can opt out of receiving the WFP to avoid the clawback process.
- The deadline to opt out for winter 2025/26 is 15 September 2025.
- You must live in England, Wales, or Northern Ireland to opt out online.
You can find out more information, and opt out on the following link:
