Overview
- Pensions Minister Torsten Bell told MPs that people whose only income is the Basic or New State Pension will not owe income tax next year because the personal allowance remains higher than the proposed pension level.
- The full New State Pension is set to rise in 2026/27 to £241.30 per week, roughly £12,547 a year, under the triple lock.
- The Treasury says it will put in place a method from 2027–28 so pensioners with only the State Pension do not have to pay small amounts of tax via Self or Simple Assessment if the pension exceeds the allowance.
- The personal allowance remains frozen at £12,570, and the OBR forecasts the freeze will pull hundreds of thousands more people into basic and higher-rate tax by 2029/30.
- A petition to lift the allowance to £20,000 has surpassed about 68,000 signatures and a separate call for a pensioner-specific double allowance has topped roughly 55,000, but the Treasury has rejected broad rises as costly and untargeted, citing a price tag of over £50 billion a year for the £20,000 plan.