Help to Save

Government scheme offers a 50% savings bonus for low-income earners

The Help to Save scheme gives low-income earners claiming universal credit or working tax credit a savings boost. It pays a 50% bonus on the amount saved, up to a maximum of £1,200 over four years – here's how the account works.

1-min read on the Help to Save scheme

We've pulled out the key info here, or see our full guide below for in-depth information.

How does Help to Save work?

  • Save up to £50/month. It's easy-access, so you can withdraw cash if you need it.
  • First 50% bonus paid after two years. Based on the highest balance during the first two years (max £600 bonus).
  • Second 50% bonus paid after four years. Based on the difference between the highest balance in years three and four and the highest balance during the first two years (max £600 bonus).
How do I qualify for Help to Save?

You need to be a UK resident (or posted overseas as a crown servant or with the armed forces) and either:
  • Receive universal credit and had take-home pay of £722.45 or more in your last monthly assessment period; or... 
  • Be entitled to working tax credit and receive working or child tax credit.

How do I apply?

Online at Help to Save on It'll need you to sign in to your Government Gateway account (the same details you use for your personal tax credits account) – or you can call HMRC on 0300 322 7093. Alternatively, you can use the HRMC app – our full guide on the HRMC app explains how to get it and how to get the most out of it.

  1. What is the Help to Save scheme?

    Help to Save is a type of savings account specially designed for low-paid workers. On the face of it, it's pretty simple. You can save between £1 and £50 a month, but you don't have to save every month. At the end of two and four years, you're paid a 50% bonus, up to a maximum £1,200. It's easy access, so you can make withdrawals if you need to.

    Watch Martin's 2-min Help to Save video

    But, before we dive into the detail, it's worth watching Martin's two-minute briefing, so you've a decent overview of the scheme...

    Embedded YouTube Video

    From The Martin Lewis Money Show Live on Tuesday 28 November, courtesy of ITV. All rights reserved. Watch the full episode on ITVX.

    A 50% bonus sounds great. What's the catch?

    No catch, though the bonus has a couple of strange twists. Here's how it works...

    After two years, you'll get the first 50% bonus paid into your bank account (not into the Help to Save account). Once that's been paid, you can either decide to stop saving, or you can keep saving into it for another two years. Again, you can save between £1 and £50 a month, but you don't have to save every month. If you keep saving, you could get another bonus paid at the end of the four years.

    Two important things to note:

    • The bonus for the first two years is paid on the highest amount you've had in the account during the two years, not the amount that's there at the end – though these could be the same.

      For example, if you'd managed to save £1,000, but needed to withdraw £200 before the end of the two years, despite having a balance of £800 at the end, you'd still get a £500 bonus, as that's 50% of your highest balance, which was £1,000.
    • The bonus in the second two years is paid on the amount that your highest balance in years three and four (let's call this balance A) exceeds your highest balance in years one and two (balance B). The bonus is 50% of the difference between balance A and balance B at their highest. This is how it could work in practice...

      Let's assume you managed to save £500 in years one and two – you'd get a £250 bonus paid out at the end of the second year. But you needed to use the £500 for car repairs, so withdrew it all.

      Then, in years three and four, you found you could start saving again and managed to save £750. In this case, you'd get a £125 bonus (this is worked out as £750 - £500 = £250, the bonus being 50% of the difference between your two highest balances).

    The first set of bonuses were paid in September 2020, as the first accounts opened were due their two-year bonus. Since then, more bonuses have been paid, with the average amount sitting at £378 – a decent addition to anyone's savings. 

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  2. Do I qualify for Help to Save?

    To qualify, you need to be a UK resident (or posted overseas as a crown servant or with the armed forces) and:

    • EITHER receiving universal credit and have employment income of £722.45 or more for the last monthly assessment period. 

    • OR receiving working tax credit.

    • OR entitled to working tax credit and receiving child tax credit.

    Plus, you can still keep saving in to the account even if you no longer qualify for working tax credit or universal credit. You only need to be eligible at the point you open the account. But you won't be able to open a joint Help to Save account – it's one per eligible person.

    Not sure if you're eligible? 

    Don’t worry – your eligibility is checked as part of the application process and you won’t be able to apply unless you’re eligible for the account. So if in doubt, give it a go.

  3. Should I use Help to Save if I have debts?

    This is our one concern about the scheme. Here's the view of founder Martin Lewis...

    'It's possible to get the best of both worlds'

    The great concern with Help to Save was that it would encourage people to save when they should instead be paying off debts, including some extremely expensive ones like payday loans. Yet they've managed to work a structure that lets people possibly have the best of both worlds.

    The fact that you're given the bonus based on the highest amount you've saved, rather than the amount that you actually have in there, means you can build up your savings until you have an emergency that you would otherwise have borrowed for, and then use your savings instead of borrowing. But you'll still be rewarded for the fact that you saved in the first place.

    It's a very clever scheme and one that will work for many people. Of course though, if you've extremely expensive debts, rather than saving, it's best to try and clear those first.

    If you've debt problems, whether you're struggling to meet minimum repayments, you owe more than you earn in a year or it's affecting your ability to sleep at night, Help to Save isn't going to be the right answer. Instead, read our Debt Help guide.

    You can open an account up until April 2025, so you could always start saving later if you manage to pay down your debts.

    • My debts are on a credit card at 0% interest. Should I use Help to Save?

      This depends on when your 0% offer runs out. If it's in two years' time or longer, and you plan to use the savings and bonus to clear the debt before you start paying interest, Help to Save could be a good savings plan. However, always remember to pay at least the minimum payment on your credit card – check you can afford this and also to save.

      Shorter 0% periods may also work if you can save enough to pay off the card at the end of the 0% period. Remember, even if you've withdrawn cash before the end of two years, you'll still get a bonus on the highest balance you had in the account.

    • Is there ever a time when it makes sense to use Help to Save rather than pay debt?

      If you've debts but you're paying them off and want to know if this is a better option, read on. But before we get into the maths, it is worth saying that even if you'd be financially better off saving to get the bonus, you may feel better psychologically if you're paying down your debt, rather than waiting two years while the interest's racking up all the time. If that's the case for you, Help to Save isn't the right answer, paying off debt is.

      Let's look at how Help to Save compares to a sample credit card...

      Let's assume you have a £1,200 debt on a card charged at 19.9% APR. Making no repayments (though in practice this is not how a credit card works), after 24 months you'd owe around £1,725.

      In Help to Save, after two years saving the maximum £50/month, you'd have £1,800 (£1,200 saved + £600 bonus). You could then use the savings + bonus to pay off the debt.

      Alternatively, if you'd used the £50/month to pay down the debt, at the end of the two years you'd still owe around £290 on the credit card (having paid just under £300 in interest).

      Of course, this is just an example assuming a constant debt and a large enough credit limit to accommodate the extra interest, which is only one possible scenario. So, we've run over a few ways to think about this that might help...

      Paying off debt vs Help to Save – general rules to follow

      1. If the idea of leaving your debt to rack up interest while you save scares you, DON'T DO IT. Pay down the debt. Remember, you can open an account until April 2025 so you could always start saving later (ideally once you're debt-free).

      2. Our examples assume you save the maximum £50/month, every month for two years, and get the max bonus. The less you can save, the lower the bonus, and the less debt it can offset.

      3. The more you owe, the less likely it is that Help to Save will be the right choice.

      4. Debts with interest rates higher than around 20% – this includes many overdrafts, payday loans, home credit and some credit cards – will mean that the benefits of Help to Save will be marginal. Interest rates over 50% mean you're always better off paying down the debt.

      5. The effective 'interest rate' on Help to Save is lower in years three and four if you choose to stay, meaning in almost all cases it's better to pay off debt rather than save in years three and four, unless the debt is very small or the interest rate is low.
  4. How do I open a Help to Save account?

    You can apply through Help to Save on – it'll need you to sign in to your Government Gateway account (the same details you use for your personal tax credits account). Alternatively, you can use the HM Revenue & Customs (HMRC) app if you have it – read our full guide on the HRMC app for more info.

    I've had quite a few reports of ID difficulties stopping people opening Help to Save. I've finally had an answer about what to do...

    - The ID required is just to set up the Government Gateway account.

    - If you don’t have ID you can call up the Help to Save support line on 0300 322 7093. They can then help open a Government Gateway account without any need for ID by asking you security questions instead. You'll need your National Insurance number.

    - HMRC have advised you should check your eligibility for the scheme first before trying to set up a Government Gateway account.

    Do let me know how it goes.

    If you're not tech-savvy, you can call 0300 322 7093 and the HMRC helpline advisers will help you set up an account.

    You can open an account up until April 2025. Once it's opened, you can keep it for up to four years.

    You can pay in to your Help to Save account by debit card, standing order or bank transfer, and can make as many deposits as you like each month, provided you don't pay in more than £50/mth overall.

    • What if I need to withdraw money?

      If you need to withdraw your cash, you can do this at any time, though you can only withdraw cash to a nominated bank account.

      Remember, even if you need to withdraw some cash, the first bonus is paid on the highest balance you achieved over two years, so there's no need to feel like the cash is locked away.

    • What happens if I close the account?

      If you close the account before two years are up, you won't get any bonus.

      Even if you do need to withdraw all your money, it's best to leave the account open, as the bonus is paid on the highest balance you made it to within the two years. So even if there's nothing left in the account at the end of the time, you may still be due a bonus payout.

      If you do close your account, you won't be able to open another one later.

    • What if I have issues with my account?

      If you have any problems with your account (eg, your bonus not being paid as expected), you can call the HMRC helpline on 0300 322 7093.

    • What else can the app do?

      If you use the HMRC app, you can use it to check your Help to Save balance, track how much you've paid in each month and how much you can still pay, as well as any withdrawals you've made.

      HMRC has also launched tools in the app which let you set up goals and reminders to add to your savings, which could be a good nudge if you're trying to save more.

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  5. Does Help to Save affect my benefits?

    On its own, no – if these are the only savings you have.

    If you've other savings, then saving here could have an effect if it puts you over the universal credit or council tax reduction savings threshold of £6,000. Above this, you lose £4.35/mth of universal credit or £1 of council tax reduction for every £250 you've saved over £6,000 (savings of more than £16,000 disqualify you from receiving universal credit or council tax reduction). 

    Important. If you live with someone who you're in a relationship with, any savings they have are included in the £6,000 threshold. So if you both save the maximum for four years under Help to Save, this could reduce your benefits (since your combined savings will then add up to more than £6,000).

    If you get working/child tax credit, the Help to Save bonus isn't taxable so doesn't count as 'other income' as normal savings interest would, which means you shouldn't see any effect on your benefits in the year the bonus is paid.

    Not sure if you qualify for these benefits? Check our Tax Credits and Universal Credit guides, or our Benefits Calculator.

  6. I'm debt-free – can I beat the returns from this account anywhere else?

    In short – no. Or at least not without picking the next sure-fire big thing and investing in it. And if you know how to do that, please tell us.

    Outside of that, most top regular savings accounts, which is what Help to Save essentially is, pay around up to 8% – a regular saver would need to have an interest rate of more than 23% to beat Help to Save.

    Is it worth continuing to save in to my Help to Save account in years three and four?

    In general, yes, as while the returns aren't quite as good – you only really get a maximum bonus of 25% in years three and four – it's still likely to beat all the other savings options out there.

    Here's why it's not as lucrative in the second two years... let's take an example of someone saving the maximum £50 every month for the full four years:

    Save £50/mth for two years and you'll have a balance of £1,200, which means you'll get a £600 bonus paid out (50%).

    To get the maximum bonus after four years, you need to keep that £1,200 in the Help to Save account and add £50/mth for the second two years, giving a total balance of £2,400. This gets you another £600 bonus.

    And while this £600 is 50% of the amount you've put in to Help to Save in years three and four, it's 25% of the total savings sitting in the account at the end of years three and four.

  7. Are my savings safe in a Help to Save account?

    Yes. The Help to Save account is run on the National Savings & Investment (NS&I) platform. NS&I is the Government's savings provider, meaning your deposits are held in 100% safety (well, unless the UK itself went bust, in which case we've all got bigger problems). Read more in our Savings Safety guide.

Other MSE savings guides...

Regular Savings: Earn higher rates by saving every month
Top Savings: Top rates and help choosing an account
Current Accounts: Earn up to 5.12% on smaller sums

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