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Expats exploit loophole on homes overseas - 14 April 2009

British expats living in some of the most sun-drenched retirement hotspots around Europe have been using EU law to make sure they get every penny of their UK benefits this winter. An article in the People newspaper this week has revealed that up to £14million in winter fuel payments have been claimed by people living overseas permanently.

It appears that more than 27,000 people living in Spain have claimed the winter fuel payment this year when average winter temperatures on the Costa del Sol are 14 degrees C.

The allowance of up to £400 per household is available to all British pensioners, and in line with other payments from the state, can be collected in any other EU country. Taxpayers groups have condemned the payments, saying they should be used for the benefit of the needy in Britain, where one of the harshest winters in recent years has just passed.

Mark Wallace, of the Taxpayers' Alliance, said: "There are serious ethical concerns about paying winter fuel allowance to people who live in the sun while pensioners back home struggle to heat their homes.The Government must get its priorities right. This allowance was meant for people freezing in Britain not someone soaking up the sun abroad.”

In the winter of 2007-2008, more than 55,000 retired Brits claimed the winter fuel allowance while living overseas, costing the taxpayer more than £9million. This year could see the figure rise above £14million, as the government has boosted payments by a quarter and there are thought to be a fifth more expats taking advantage of the loophole in the system.

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