The money will be paid next year, after people on means-tested benefits received a £650 payment this year. The £650 was paid in two instalments, with most people receiving the second £324 payment in November.
Details about how and when the £900 payment will be made have yet to be released.
In response to a recent query from MP Neale Hanvey about the cost of living payment, DWP minister Mims Davies said: “Eligibility criteria for the 2023/24 Cost of Living Payments will be published in due course.”
As with the £650 payment, people who receive only tax credits will be paid the money separately by HMRC.
The payment will be tax-free and not count towards a person’s benefit cap, and will not impact their benefits claim.
Eligible older Britons have been urged to put in a Pension Credit application by December 18, as they will be able to backdate their claim by up to three months, and claim the second instalment of the £650 payment.
The benefit tops up the income of people above state pension age on low incomes, to help with daily costs.
Pension Credit can offer a major boost to a person’s income, yet it is thought some 850,000 eligible households are missing out.
John Palmer, director of policy and communications at Independent Age, warned people to act sooner rather than later.
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He said: “We’re urging all older people to check now whether they could receive Pension Credit. Time is running out.
“Not only could they receive an extra £324 to help with the cost of living, but they will gain an additional weekly income and unlock a host of other entitlements.
“Even after the deadline to backdate the claim, all older people should check if they are eligible for Pension Credit. The support you could be entitled to is sitting in a pot, with up to £1.7billion a year not being received.
“During this tough winter, we all need to make sure we’re receiving all the support we’re entitled to.”
Claiming Pension Credit can also provide access to other sorts of Government assistance to help older Britons.
People can also receive a free TV licence if over 75, council tax reduction and free NHS dental treatment.
During the winter months, pensioners on the benefit are also entitled to a Warm Home Discount, as well as a Cold Weather Payment if the temperature triggers the system in their area.
Pensions minister Laura Trott, said: “The run up to Christmas is always a busy time. But one thing to make sure that’s on your list over the coming days is to find out whether you or your loved ones could be eligible for Pension Credit.
“Pension Credit can make a real difference and I am determined to make sure this support – worth an average of £3,500 per year – is reaching everyone who needs it.”