Millions of state pensioners are being warned to check their finances now or face a double Winter Fuel payment tax raid. The £200 or £300 Department for Work and Pensions (DWP) Winter Fuel Allowances will return this autumn and winter.
Who Is Affected by the Clawback?
After the Labour Party government reinstated the payments for all state pensioners born before 1960, it confirmed older people with income over £35,000 now have to pay it back. Anyone on PAYE earning above this threshold is currently having their winter 2025 payment clawed back automatically.
But from the 2027/28 tax year, HMRC will start clawing back the Winter Fuel Payment in the same year it’s paid out, rather than the year after. It means the money for winter 2027 will be collected in 2027/28.
Double Payment Collection in 2027/28
However, the payment - which can be worth £300 - for winter 2026 will be collected in that same 2027/28 tax year, too. It means HMRC could come calling for £600 sums. Typically, you only get £300 if you were born before 1946, with £200 for pensioners born between 1946 and 1960. It means state pensioners aged 66 to 80 face £400 bills.
How to Opt Out
To opt out of getting Winter Fuel Payments, you need to either complete the opt out form before 11:59pm on 20 September 2026 or call the helpline before 6pm on 18 September 2026. You’ll need to provide your National Insurance number when you use the online form or call the helpline. If your total income is over £35,000 and you did not opt out, HMRC will take your Winter Fuel Payment back. You cannot return it yourself. You do not need to opt out every year. You will not receive Winter Fuel Payment in future years unless you opt in again.
Example of Tax Code Adjustment
HMRC gives the example: "Unless you opt out of receiving the payment, we’ll collect your payments for the 2 tax years by changing your tax code for the 2027 to 2028 tax year. For example, if you receive a payment in each tax year of £200, we’ll deduct about £33 each month extra in tax in the 2027 to 2028 tax year."
