The Help to Save initiative is available to working people on tax credits and universal credit, and will reward them with an extra 50p for every £1 they save.

It means those who save the maximum amount of £2,400 over four years would receive a bonus of £1,200, which the government says could help pay for anything from a broken boiler to a family holiday.

Between £1 and £50 can be stashed away each month and after two years people will receive a 50% bonus on their savings, which could by then stand at £1,200.

Another 50% tax-free bonus becomes available after four years, which equates to half of the savings paid in above the highest balance saved in the first two years.

Withdrawals can be made at any time and do not affect bonus payouts, which are made into savers’ bank accounts rather than their Help to Save accounts.

The accounts can be shut at any time but early closures will mean customers miss their next bonus – and they will not be able to set up another account.

But if their situation changes and they stop receiving working tax credit or universal credit, they can still save and receive any bonus they are entitled to.

Any savings or bonuses your earn through Help to Save will not affect how much Working Tax Credit you get.

How to apply