HMRC is urging people to check if they qualify for a unique savings account that comes with a 50% government-backed bonus of up to £600 every two years. Currently, it’s only open to working Universal Credit recipients, although eligibility is set to widen from 2028.

HMRC shared on X: “Want to boost your savings? With Help to Save, for every £1 eligible Universal Credit claimants save, the Government adds 50p. That’s up to £1,200 in bonus payments over four years. Check eligibility and apply today via the HMRC app.”

Help to Save is a Government-backed savings scheme aimed at those on lower incomes, offering a 50% bonus every two years rather than the interest rates found with traditional savings accounts. Help to Save can only be opened through the Government-backed National Savings and Investments. To be eligible, you must be claiming Universal Credit while also working and earning at least £1 each month. You can save up to £50 per month into the account for up to four years. Saving the maximum amount will see you accumulate £2,400 before the HMRC bonus is applied.

How does the bonus work?

Unlike traditional savings accounts, Help to Save doesn’t pay interest but instead provides a generous government bonus at the two-year mark and again at the four-year mark. The bonus equals up to 50% of the highest balance your account reached during the two years, even if you’ve made withdrawals.

For example, if your account’s highest balance during the initial two years was £500, but you subsequently withdrew a small sum, you should still qualify for a £250 bonus payment at the two-year mark.

If you’re able to save the maximum £50 each month for the full four years without making any withdrawals, you’ll receive a £600 bonus payment in the second year and a further £600 bonus payment in the fourth year. This brings the total government bonus to £1,200.

Both the savings and the bonus payment are tax-free. You can withdraw your savings at any time through your online account or via the HMRC app, though withdrawals may take up to three working days according to Money Helper. That said, withdrawing money can occasionally affect your government bonus.

After four years, your Help to Save account will be shut and the funds, alongside the final bonus payment, will be moved into your nominated bank account. However, once your account has been shut, you won’t be able to reopen it or start another Help to Save account.

You only need to satisfy the eligibility requirements for the account on the day you apply for it, not for the entire four-year period. For instance, if you stop receiving Universal Credit whilst your account is still active, it will stay open until the end of your four-year term.

Leaving the UK can affect your Help to Save account, depending on how long you’re away. However, those serving in the UK armed forces or people working overseas as a Crown Servant or their partner are allowed to keep using their Help to Save account while overseas.