Help to Save scheme paying £1,200 cash bonus extended
More low-income earners will be able to open a Help to Save account as the Government’s extended the scheme by over 18 months.
In a bid to boost the savings habits of low earners, the Treasury and HMRC have extended the September 2023 Help to Save end date to April 2025.
Help to Save was launched in September 2018, aimed at the 3.5 million people in receipt of Tax Credits and Universal Credit.
It’s a Government savings scheme for low-income earners which pays a 50% bonus – worth up to £1,200 – over four years.
Savers can put away between £1 and £50 a month, with each pound saved receiving a 50p bonus paid out in the second and fourth years.
One of the big perks of Help to Save is that account holders can withdraw the money whenever they need it, and they will still get a bonus which is the equivalent to half of their highest balance.
However, the scheme take up has been poor, with just 359,000 savers opening an account, while a further three million eligible savers could benefit. So far, £255m has been saved into them.
How to open a Help to Save account
To open a Help to Save account, visit Gov.uk or go via the HMRC app. You’ll need to be in receipt of Working Tax Credit, Child Tax Credit and be entitled to Working Tax Credit, or Universal Credit as long as your take-home pay was £722.45 or more in the last monthly assessment period. SeeYourMoney.com’s Help to Save guide for more information.
Last month, the Government launched a consultation on Help to Save to encourage more people to save in them and to seek views on how the scheme could be reformed and simplified.
It came as part of 23 technical tax updates to simplify and modernise the tax system, which included a big child benefit change to help boost parents’ pension.
Andrew Griffith, economic secretary to the Treasury, said: “Millions of people could benefit from a boost to their savings through Help to Save and thanks to our Spring Budget reforms the scheme has been extended until 2025.
“Whatever amount you can save will trigger a top up from the Government, so take advantage and apply today.”