Eligible individuals can secure a tax-free £1,200 bonus through the UK government's Help to Save scheme. This unique savings account offers a 50 per cent bonus on amounts saved over four years, with eligibility substantially expanded from 6 April 2025 to include many Universal Credit claimants earning £1 or more from work, alongside existing Working Tax Credit and Child Tax Credit recipients. Understanding the scheme's mechanics and the recently widened criteria is the gate to claiming the bonus.
What is the Help to Save scheme and how does the 50% bonus work?
Help to Save is a UK government savings scheme administered by HM Revenue and Customs (HMRC) designed to support working low-income households in building savings. The core benefit is a tax-free bonus equal to 50 per cent of the highest balance achieved during the account's life, paid in two instalments.
Savers can deposit a maximum of £50 per calendar month into their account. Over the four-year term, this allows for a maximum total saving of £2,400. The maximum bonus payable is £1,200 over this period.
Bonuses are calculated on the highest balance reached during each two-year window, not on the closing balance. For example, if a saver deposits £50 each month for two years, reaching £1,200, but then withdraws £200, the first bonus will still be calculated on the £1,200 peak. However, frequent withdrawal-and-deposit cycles can reduce future bonus potential as it lowers the peak balance in subsequent periods. Help to Save accounts are operated by National Savings and Investments (NS&I) on behalf of HMRC, meaning the savings are 100 per cent backed by HM Treasury, exceeding the £85,000 Financial Services Compensation Scheme limit that applies to commercial bank accounts.
Who is eligible for Help to Save from April 2025 and April 2028?
The eligibility criteria for Help to Save have undergone significant expansion, making the scheme accessible to a broader range of low-income households.
From 6 April 2025, eligibility widened to include:
- Any working individual receiving Universal Credit who earns £1 or more in their assessment period.
- The working partner in a joint Universal Credit claim, if they earn £1 or more in the assessment period.
- Working Tax Credit recipients.
- Child Tax Credit recipients who are also entitled to Working Tax Credit.
Looking ahead, the Autumn Budget 2025 announced further expansion. The scheme will be made permanent and, from April 2028, will include all Universal Credit claimants who receive the child element, the caring element, or both, regardless of their work status.
Despite its benefits, independent estimates and HMRC data consistently report that only a minority of eligible working low-income UK households have opened a Help to Save account, indicating it remains a heavily under-claimed scheme.
How much can you save and when are bonuses paid?
The Help to Save scheme allows for consistent, manageable savings with a clear bonus structure. An account holder can deposit up to £50 per calendar month into their account.
Over the full four-year term, this monthly deposit pattern allows an individual to save a maximum total of £2,400. The scheme's significant incentive is the bonus payment, which totals £1,200 if the maximum savings potential is reached. Bonuses are paid in two distinct stages:
- Year 2 Bonus: A payment of up to £600 at the end of the second year. This bonus is calculated as 50 per cent of the highest balance achieved during the initial two-year period.
- Year 4 Bonus: A second payment of up to £600 at the end of the fourth year. This bonus is calculated as 50 per cent of the highest balance achieved during the subsequent two-year period (years 3 and 4), less any bonus already paid.
The bonus calculation prioritises the highest balance, providing flexibility for savers who may need to withdraw funds. However, to maximise the bonus, maintaining a steady or increasing balance is beneficial.
How does Help to Save impact Universal Credit and other benefits?
A critical feature of the Help to Save scheme for eligible households is its favourable treatment within the benefits system. Saving into a Help to Save account does NOT negatively impact Universal Credit or Housing Benefit claims. Money saved into the account, up to £6,000, is disregarded for the Universal Credit and Housing Benefit capital tests for the duration of the account's term.
Bonus payments received from Help to Save are NOT counted as income for Universal Credit, Housing Benefit, or other means-tested benefits. This protection ensures that individuals can save and benefit from the bonus without fear of their regular benefit entitlements being reduced or stopped. This provision removes a common barrier to saving for low-income households, allowing them to build a financial buffer.
Help to Save vs. Cash ISA or Lifetime ISA: Which savings option is better?
Understanding how Help to Save compares to other savings vehicles like Cash ISAs and Lifetime ISAs is important for eligible individuals. Help to Save offers a unique government-backed 50 per cent bonus, unmatched by standard Cash ISAs, and is specifically targeted at working low-income households.
A Cash ISA allows individuals to save money tax-free, typically with higher annual deposit limits than Help to Save, but without a government bonus. Lifetime ISAs are designed to help people aged 18-39 save for their first home or retirement, offering a 25 per cent government bonus on contributions up to £4,000 per year, but with specific withdrawal conditions and potential penalties.
Help to Save is administered separately from Cash ISA and Lifetime ISA accounts. An individual can hold all three at the same time, provided they meet each scheme's respective eligibility rules. For those who qualify for Help to Save, its 50 per cent bonus on monthly savings up to £50 delivers a guaranteed return well above anything available on commercial savings, making it a compelling option. The choice between these accounts depends on individual circumstances, savings goals, and eligibility.
What should you do next?
Individuals who believe they may qualify for Help to Save should check their eligibility and consider opening an account. The process is straightforward and can be completed online. Accounts can be opened directly at gov.uk/get-help-savings or via the HMRC app.
Applicants will need a Government Gateway login to access the service. It is a single-use scheme; an individual can only open one Help to Save account in their lifetime, and the four-year term cannot be extended or renewed.
Citizens Advice and Money Helper, the official government-backed financial guidance service, both maintain free guidance pages on Help to Save eligibility and how to apply. At the end of the four-year term, all Help to Save savings, including any bonuses, are transferred to the account holder's nominated bank account, and the Help to Save account itself closes.