Around 900,000 people in receipt of the State Pension may need to pay tax for the 2024/25 financial year.
Financial experts from Spencer Churchill are warning that up to 900,000 retirees may face an unexpected tax bill at the end of the new financial year due to income from their State Pension. Pensioners may have to start setting money aside to pay income tax bills as the Personal Allowance will remain frozen at £12,570 during the 2024/25 financial year.
Someone on the full rate of the Basic State Pension will see payments go up from £156.20 per week to £169.50 - this amounts to £678 each pay period. Over the 2024/25 financial year, this is an increase of £692, taking the annual income from £8,122 to £8,814. Top Money Stories Today On the number of affected retirees The spokesperson said: “This year, up to 900,000 retirees, particularly those benefiting from the Marriage Allowance, might find themselves paying taxes on their State Pensions for the first time. This is a direct consequence of the substantial rise in State Pensions and the freezing of tax thresholds. It's a significant change that requires careful financial review and planning.
The UK Government recently rejected an online petition calling for income tax on the State Pension to be scrapped in order to help “reduce the tax burden on pensioners”.
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