Guarantee Credit

Guarantee Credit is one part of Pension Credit, see Pension Credit; the second part of Pension Credit is Savings Credit, for more information see Savings Credit. Guarantee Credit ensures that every pensioner’s retirement income exceeds the Minimum Guarantee set out by the government. The Minimum Guarantee is the minimum amount of money that the state considers you should have to live on. The Minimum Guarantee for 2007/2008 is set at £119.05 a week for single people and £181.70 a week for couples. In this case if you are living together as a couple you are considered a couple for the purposes of Pension Credit: your relationship must not be legally recognised, that is, you must not be married or be civil partners. The Minimum Guarantee is lower for couples than for two single people because it is assumed that couples will be sharing household expenses. The Minimum Guarantee may be higher if you are severely disabled, if you are working as a carer, or in some cases if you need help covering housing costs: in these cases you may be entitled to receive more Pension Credit. The Minimum Guarantee is increased annually in line with the earnings national average.

If you are over sixty and your retirement income is less than the Minimum Guarantee then Guarantee Credit will top up your retirement income to match the Minimum Guarantee. If for example you are single and the basic State Pension is your only source of income, at £87.30 for 2007/2008, you would be entitled to £31.75 Guarantee Credit a week. Thus your retirement income would be £119.05 a week, in line with the Minimum Guarantee. Currently qualifying disabled people can receive up to £48.45 extra Pension Credit, and carers up to £27.15 extra. If you believe that you are a candidate for basic or extra Guarantee Credit contact the Pension Service on 0800 99 1234 for assistance.