Pensioners across England and Wales have been told they might be unknowingly losing their eligibility for the winter fuel payments due to their savings. The Department for Work and Pensions (DWP) has confirmed that pensioners earning below £35,000 annually will automatically receive payments of £200 or £300 this winter.

However, Coventry Building Society warned that many individuals could unintentionally surpass the threshold, potentially forfeiting up to £300 in support for their energy bills. This is because interest earned on savings held outside of ISAs is included in the Labour Government’s newly implemented £35,000 income threshold.

Jeremy Cox, the head of Strategy at Coventry Building Society, warned that “thousands could still unknowingly be left out in the cold – not because they’re earning more, but because their savings are”.

He explained that “many pensioners may not realise that interest earned on savings held outside of ISAs count towards their total taxable income”, reports Leicestershire Live.

He added: “With interest rates still relatively high, even modest savings can generate income that pushes someone over the threshold.”

Interest from standard savings accounts is treated as taxable income and contributes to the income threshold—even when it falls within the tax-free Personal Savings Allowance. For instance, a pensioner with £20,000 in a regular savings account earning 4.5% interest would receive £900 a year.

Although this amount remains untaxed under the £1,000 allowance for basic rate taxpayers, it still counts toward their total taxable income. That £900 would be factored in when assessing eligibility for the winter fuel payment.

So, for someone whose income is already near the £35,000 limit, that extra savings interest could tip them over the threshold, causing them to miss out on the £200 or £300 winter support, despite not paying tax on the interest itself.