An estimated 800,000 State Pensioners will be ‘dragged into paying income tax’ after the April uprating.
Retirement experts are warning that around 800,000 older people will be “dragged into paying income tax" from April due to the UK Government's "failure to raise thresholds in line with inflation”.
Someone on the full New State Pension will see their payments go up from £203.85 per week to £221.20, or £884.80 every four-week pay period. Over the 2024/25 financial year, this is an increase of £902, taking the annual income from State Pension alone from £10,600 to £11,502. This leaves just £3,756 before the personal tax threshold is exceeded, equivalent to additional income totalling £313 per month.
“Only a few years ago, in the tax year 2019/20, the full State Pension was equivalent to 70 per cent of the Personal Allowance and people had £3,732.80 of headroom before they hit the limit.”
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