The New and Basic State Pensions will rise by 4.1 per cent from next April while additional elements are set to increase by 1.7 per cent
The New and Basic State Pensions are set to increase by 4.1% from April next year, while additional elements will see a rise of 1.7%. This is in line with the Triple Lock system, which ensures that these pensions increase annually according to the highest figure between average annual earnings growth from May to July , CPI in the year to September , or 2.5%.
Meanwhile, the Personal Allowance will stay frozen at £12,570 until the beginning of the 2028/29 financial year. The full New State Pension, currently valued at £11,502 for the 2024/25 tax year, will increase to £11,973 in 2025/26. For most people, this would be automatically deducted through PAYE on employment and tax on private pensions. Those who don't pay tax automatically will receive a tax bill from HMRC the following summer, to be paid by January in the next year, reports the Daily Record.
This isn't a new phenomenon. With auto-enrolment in the workplace now in its 12th year, more people will benefit from increased income in retirement and will likely pay tax, typically deducted from their private pension.
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