More than 8 million people in retirement currently pay tax.
Martin Lewis has broken down the tricky topic of tax and State Pension s in his latest Podcast to clear up any confusion for 12.7 million people over retirement age who got in touch after the first televised General Election debate earlier this week. During the ITV debate on Tuesday night between Rishi Sunak and Labour leader Sir Keir Starmer, the Prime Minister warned that “for the first time in our country’s history, if Labour are elected, pensioners will pay tax.
He then explained that the most-likely reason for two-thirds of all State Pensioners paying tax is because additional income took them over the £12,570 allowance threshold. Top Money Stories Today He explained: “The State Pension has a Triple Lock which means it rises each year with the highest of inflation, average earnings or 2.5%.
He ended by reminding listeners that it is a person’s overall income that is measured against the Personal Allowance which determines whether they need to pay tax, not just income from the State Pension.Latest State Pension News State Pension and Tax in a nutshell There are nearly 12.7 million people over State Pension age across Great Britain, including more than 1.1m living in Scotland.
The full New State Pension is now worth £221.20per week and as payments are typically made every four weeks, this amounts to £884.80 each pay period. Someone on the full rate of the Basic State Pension will receive £169.50 each week - this amounts to £678 each pay period. Over the 2024/25 financial year, this is an increase of £692, taking the annual income to £8,814.
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