Schedule 10 | Winter fuel payment charge

(1)Part 10 of ITEPA 2003 (social security income) is amended as follows.

(2)At the end of the heading insert “etc”.

(3)In section 655 (structure of Part 10), in subsection (1), at the end insert—

(4)After Chapter 8 insert—

681IWinter fuel payment charge

(1)A person (“P”) is liable to a charge to income tax for a tax year if—

(a)P is entitled to a winter fuel payment in respect of the qualifying week, and

(b)P’s total income for the tax year exceeds £35,000.

(2)The charge is to be known as the “winter fuel payment charge”.

(3)The amount of the charge is equal to the amount of the winter fuel payment.

(4)But P is not liable for the charge if P is entitled to a relevant benefit on any day in the qualifying week.

(5)The following are “relevant benefits”—

(a)income support under section 124 of SSCBA 1992 or section 123 of SSCB(NI)A 1992;

(b)an income-based jobseeker’s allowance under section 1 of JSA 1995 or Article 3 of JS(NI)O 1995;

(c)state pension credit under section 1 of SPCA 2002 or section 1 of SPCA(NI) 2002;

(d)an income-related employment and support allowance under section 1(2)(b) of WRA 2007 or Part 1 of the Welfare Reform Act (Northern Ireland) 2007;

(e)universal credit under Part 1 of WRA 2012 or Part 2 of the Welfare Reform (Northern Ireland) Order 2015.

(6)In this section—

(a)a “winter fuel payment” means a payment under the Social Fund Winter Fuel Payment Regulations 2025, the Winter Heating Assistance (Pension Age) (Scotland) Regulations 2024 or the Social Fund Winter Fuel Payment Regulations (Northern Ireland) 2025;

(b)the “qualifying week”, in relation to a tax year, means the week beginning on the third Monday in the September of that tax year.

681JAlteration of income limit by Treasury order

(1)The Treasury may by order substitute another amount for the amount for the time being specified in section 681I(1)(b).

(2)An order under this section has effect for tax years beginning after the order is made.

(3)A statutory instrument containing an order under this section which increases any person's liability to income tax may not be made unless a draft of it has been laid before and approved by a resolution of the House of Commons.

(2)In section 7 of TMA 1970 (notice of liability to income tax and capital gains tax), in subsection (3)(c), at the end insert “other than Chapter 9 of Part 10 of ITEPA 2003 (winter fuel payment charge)”.

(1)ITEPA 2003 is amended as follows.

(2)In section 1 (overview of contents of this Act), in subsection (3), after paragraph (aa) insert—

(ab)makes provision for the winter fuel payment charge (see Chapter 9 of Part 10),

.

(3)In section 684 (PAYE regulations), in subsection (2), after Item 2ZA insert—

2ZBProvision—

(a)for deductions to be made, if and to the extent that the payee does not object, with a view to securing that income tax payable for a tax year by the payee by virtue of section 681I (winter fuel payment charge) is deducted from PAYE income of the payee paid during that year,

(b)for repayments to be made in a tax year, if and to the extent that the payee does not object, in respect of any amounts overpaid on account of income tax under that section for that tax year, and

(c)as to the circumstances and manner in which a payee may object to the making of deductions or repayments.

(4)In section 717 (orders and regulations made by Treasury or Commissioners), in subsection (4)—

(a)after “section 681F(3)” insert “or 681J(3)”;

(b)after “benefit” insert “or winter fuel payment”.

(1)ITA 2007 is amended as follows.

(2)In section 1 (overview of the Income Tax Acts), in subsection (1)(a), after “benefit” insert “and winter fuel payment”.

(3)In section 30 (additional tax), in subsection (1), after “Chapter 8 of Part 10 of ITEPA 2003 (high income child benefit charge),” insert—.

(5)The amendments made by this Schedule have effect for the tax year 2025-26 and subsequent tax years.