Backed by the government for security, the scheme offers a generous 50% bonus on savings, which can potentially add up to £1,200 in tax-free cash over four years. This article provides a comprehensive overview of the Help to Save scheme, explaining how it works, the eligibility requirements and how the bonus is structured.
1 minute summary
- What is it? A government-backed savings account for people on certain benefits (Working Tax Credit or Universal Credit with some earnings).
- The Bonus: Get a 50% bonus on your savings, paid in two parts after 2 and 4 years.
- Maximum Reward: Save up to £50 per month for 4 years (£2,400 total) to get the maximum bonus of £1,200.
- Eligibility: You need to be receiving Working Tax Credit OR Universal Credit and have earned at least £1 from work in your last assessment period. Eligibility is checked only when you apply.
- Flexibility: Save £1-£50 monthly; no need to save every month. You can withdraw money, but it might affect your final bonus.
- Duration: The account lasts exactly 4 years and then closes automatically. You cannot open another one.
- How to Apply: Apply online via GOV.UK or the HMRC mobile app
What is the Help to Save scheme?
Help to Save is a specific type of savings account offered by the UK government. Its fundamental purpose is to encourage and support individuals on low incomes to build a regular savings habit and enhance their financial resilience. The account has a fixed duration of four years from the date it's opened before closing automatically. Once an account matures (or if it is closed early by the saver) it cannot be reopened, nor can the individual open another Help to Save account. This structure underlines the scheme's design as a time-limited opportunity, aimed at fostering a savings habit within a defined period. The scheme is administered by HM Revenue & Customs (HMRC) and the accounts themselves are managed by National Savings and Investments (NS&I).
How does the Help to Save bonus work?
The central attraction of the Help to Save scheme is its generous bonus structure. For every £1 saved, the government adds a 50p bonus. This bonus is paid out in two instalments: one after the end of the second year and a final one after the end of the fourth year. These bonus payments are made directly into the saver's linked bank account, not into the Help to Save account itself.
The calculation of the Help to Save bonuses are based on the highest balance achieved within specific periods, which has important implications. We break it down below:
- Year 2 Bonus: This is calculated as 50% of the highest balance the account reached at any point during the first two years (Years 1 and 2). This means even if funds are withdrawn during this period, the bonus is based on the peak amount saved up to that point. For example, if the highest balance reached was £850, the Year 2 bonus would be £425 (50% of £850)
- Year 4 Bonus: This final bonus is calculated differently. It is 50% of the difference between the highest balance achieved in the first two years (the figure used for the Year 2 bonus) and the highest balance achieved during the last two years (Years 3 and 4). A critical point here is that if the highest balance achieved in Years 3 and 4 does not exceed the highest balance from Years 1 and 2, no final bonus will be paid.
The bonuses are structured in a way to reward those who save consistently. Additionally, individuals who avoid withdrawals (particularly in the latter two years) will be able to maximise their final bonus. To demonstrate this, consider a saver who reaches a peak balance of £1,200 in the first two years, receiving a £600 bonus. If they then withdraw all £1,200 and subsequently save another £1,200 during Years 3 and 4 (reaching a peak balance of £1,200 in that period), their final bonus would be zero. This is because the highest balance in Years 3 and 4 (£1,200) did not exceed the highest balance from Years 1 and 2 (£1,200).
What is the maximum bonus you can earn with the Help to Save scheme?
The maximum possible bonus over the four years is £1,200. This is achieved by saving the maximum allowable amount of £50 each month for the full 48 months, resulting in total savings of £2,400 and triggering total bonuses of £1,200.
Help to Save – Year 2 Bonus Potential (Based on highest balance in Years 1 & 2)
| Monthly Saving Amount (Consistent) | Highest Balance Reached in First 2 Years | Year 2 Bonus Paid (50% of Highest Balance) |
| £10 | £240 | £120 |
| £25 | £600 | £300 |
| £50 | £1,200 | £600 |
This table illustrates the first bonus payment based on consistent monthly savings with no withdrawals during the first two years.
Help to Save – Year 4 Bonus Potential (Based on Growth in Highest Balance)
| Highest Balance (Years 1&2) | Highest Balance Reached (Years 3&4) | Difference (Growth) | Year 4 Bonus Paid (50% of Difference) |
| £1,200 | £2,400 | £1,200 | £600 |
| £1,200 | £1,800 | £600 | £300 |
| £1,200 | £1,200 | £0 | £0 |
| £600 | £1,200 | £600 | £300 |
| £600 | £600 | £0 | £0 |
This table shows how the final bonus depends on the increase in the highest balance achieved between the first two years and the last two years. If the highest balance doesn't increase, no final bonus is paid.
How much can you save in the Help to Save scheme?
Savers can deposit between £1 and £50 into their Help to Save account each calendar month. It is possible to make multiple deposits within a single calendar month, provided the total amount deposited does not exceed the £50 limit. There isn't a requirement to deposit money every single month, however, consistent saving is necessary to reach the maximum potential bonus.
Are You Eligible for the Help to Save scheme?
Eligibility for a Help to Save account is based on whether you receive specific state benefits and, in the case of Universal Credit, having some earnings from work. An individual must be living in the UK (with specific exceptions for Crown servants and armed forces members or their spouses/civil partners serving overseas) and must not have previously opened a Help to Save account.
Qualifying criteria:
- Receiving Working Tax Credit (WTC). Entitlement to Child Tax Credit may also qualify alongside WTC.
- Receiving Universal Credit (UC) AND having earned income from work of at least £1 in the monthly assessment period immediately before applying.
This second criterion for UC claimants represents a significant change implemented from April 2025. Previously, UC claimants needed to meet a much higher earnings threshold. The nominal £1 earnings requirement has dramatically broadened eligibility, particularly for those in low-paid part-time work, on zero-hours contracts, or those who have fluctuating income.
For couples receiving benefits jointly (either Tax Credits or Universal Credit), both partners may be able to open their own individual Help to Save account, provided the household meets the eligibility criteria. In the case of Universal Credit, the £1+ earnings requirement is assessed based on the couple's total combined earnings.
A crucial aspect of eligibility is that it is determined only at the point of application. This means that if an individual qualifies and successfully opens an account, they can continue saving and earning bonuses for the full four years, even if their circumstances change at a later date. This “lock-in” feature provides security for savers, meaning you should consider applying as soon as you are eligible, even if you anticipate your benefit or income situation might change in the future.
Deposits and Withdrawals
Deposits into a Help to Save account can be made via debit card, standing order, or bank transfer. Account management is straightforward and can be accessed via the GOV.UK website or via the dedicated HMRC mobile app. The app allows users to view their account balance, check bonus details, and make deposits.
Funds within the account can also be withdrawn at any time if needed and can only be paid out to the saver's nominated bank account, which is linked during the application process. Withdrawals provide flexibility and access to funds in emergencies, however, savers must be aware of the potential impact on bonuses. Withdrawing money, especially after the first two years, can reduce or entirely eliminate the final bonus payment, as it may impact the final calculation based on the highest balance achieved.
Will Help to Save impact your benefits?
A common concern for potential applicants is whether participating in the Help to Save scheme could negatively impact their existing benefit payments. The scheme has been designed to minimise impacts on the main qualifying benefits, summarised below:
- Universal Credit (UC): Having savings (including money held in a Help to Save account) of up to £6,000 generally does not affect Universal Credit payments. Crucially, any bonuses received from the Help to Save scheme do not count as income and therefore does not affect UC payments.
- Working Tax Credit (WTC): WTC payments are not affected by savings held in, or bonuses received from, a Help to Save account.
- Housing Benefit (HB): Similar to UC, savings up to £6,000 (including Help to Save funds) generally do not affect Housing Benefit payments. Help to Save bonuses received do not affect HB payments.
Users must take note of capital limits for means-tested benefits like UC and HB. While savings and bonuses from Help to Save alone (£2,400 savings + £1,200 bonus = £3,600 maximum) are well within the £6,000 threshold, individuals need to consider their total capital. If their savings from all sources (including Help to Save) exceed £6,000, their benefit payments may be reduced, and eligibility may cease altogether if total capital exceeds £16,000. However, the specific feature of disregarding the Help to Save bonuses for benefit calculations should ensure that the incentive doesn't inadvertently penalise recipients.
How to apply for the Help to Save scheme
The process for applying for a Help to Save account is designed to be quick and straightforward and can take less than five minutes if applying online.
Applying online
This is the primary application method and users have the choice of the following:
- Online via the GOV.UK website
- Through the official HMRC mobile app
Applying over the phone
For those unable to apply online, there is an option to apply by telephone by calling HMRC on 0300 322 7093 (closed on Saturdays, Sundays and Bank Holidays).
- Their National Insurance number.
- Their bank account details (for paying bonuses and processing withdrawals).
- A Government Gateway user ID and password. If an individual doesn't have one, they can create one as part of the application process.
What happens when the 4 years are up?
Your Help to Save account has a fixed lifespan and will automatically close exactly four years after you first opened it. You don't need to take any action for this closure to happen.
When the account closes, both the remaining savings and the final bonus are automatically transferred into the nominated bank account you linked when you set up your Help to Save account. You can update these bank details via your online account before the maturity date if needed. The final payment usually happens within around 10-14 days of the account closing.
If you choose to close your account before the four years are up, you will receive the balance of your savings paid into your nominated bank account, however, you will miss out on any future bonus payments that would have been due. For example, closing the account before the two-year mark means losing the first bonus, and closing it between years two and four means forfeiting the final bonus. Even if you need to withdraw all your money, you should consider leaving the account open until the relevant bonus date (year 2 or year 4) to ensure you receive any bonus earned based on your highest balance.
Is Help to Save right for you?
The scheme is best suited for individuals who meet the eligibility criteria, can commit to saving regularly (even small amounts) over a four-year period, and are motivated by the prospect of a large government bonus to help build a savings buffer. Below, we have highlighted the main pros and cons of the Help to Save scheme.
Pros
- The potential to earn a generous 50% government bonus on savings, up to £1,200
- Offers flexibility in terms of the amount (£1-£50 per month) and frequency (no requirement to save every month)
- Easy access to saved funds through withdrawals
- Security of savings backed by the UK government
- Designed to avoid impacting key means-tested benefits such as Universal Credit and Working Tax Credit
- A quick and easy application process, manageable online or via an app
Cons
- A relatively low monthly saving limit of £50
- The structure of the bonus calculation means withdrawals can significantly reduce or eliminate the final bonus payment
- The account automatically closes after four years, with no possibility of renewal or opening another account
- Eligibility is strictly limited to recipients of Working Tax Credit or Universal Credit (with some earnings)
Summary
The Help to Save scheme offers a generous savings initiative targeted at supporting those on lower incomes. The 50% bonus provides an opportunity to build a savings pot that might otherwise be difficult to achieve. Recent changes, including the extension of the scheme and the expansion of eligibility criteria for Universal Credit claimants, mean that more people than ever before are potentially able to benefit.
You can check your eligibility and apply via the GOV.UK website or via the HMRC mobile app, and there is also an option to apply via telephone. The Help to Save scheme can provide a valuable way for those on low incomes to start a regular savings habit, helping them build greater financial resilience.
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