The campaigner argues this would give pensioners <\/a>a \u201chigher tax-exempt limit, but wealthier pensioners would still pay tax\u201d adding \u201cwe think that people with small private or workplace pensions are currently being taxed unfairly\u201d.<\/p>\n The \u2018Introduce new tax code for State Pensioners with double the personal allowance\u2019 has been posted on the Petitions Parliament website<\/a>. At 10,000 signatures it would be entitled to a written response from the UK Government, at 100,000 it would be considered by the Petitions Committee for debate in Parliament.<\/p>\n READ MORE: State Pension age set to rise next April for people born in specific years<\/a>READ MORE: Pensioners urged to check if they will pay tax in retirement next year<\/a><\/p>\n The latest HM Revenue and Customs <\/a>(HMRC) data indicates 8.7 million pensioners are projected to pay income tax on their retirement income for 2025\/26. It marks an increase of around 420,000 compared to the previous year (2024\/25) and a rise of 1.85m from 10 years ago (2015\/16).<\/p>\n The data comes following the freezing of the Personal Allowance thresholds at \u00a312,570 until April 2028, while the full annual New State Pension reached \u00a311,973 in 2025\/26, tipping hundreds of thousands more pensioners into paying income tax.<\/p>\n The latest figures from the Department for Work and Pensions (DWP) show there are now 13 million people of State Pension age across the country.<\/p>\n The UK Government has also confirmed it will honour the Triple Lock policy during this parliamentary term. However, this could see everyone on the full, New State Pension pushed over the tax threshold in just two years\u2019 time (2027\/28 financial year).<\/p>\n David Brooks, head of policy at leading independent consultancy Broadstone, said: \u201cWe would expect a growing number of pensioners to be liable for income tax as the country\u2019s demographic changes due to our ageing population.<\/p>\n \u201cFiscal drag, however, is also bringing hundreds of thousands more pensioners into paying Income Tax bracket every year as the frozen Personal Allowance thresholds combines with the Triple Lock-protected State Pension.<\/p>\n \u201cWhile perhaps personally frustrating for many pensioners, it reflects the nature of inflation linked occupational pensions and a Triple-locked State Pension that continues to rise.\u201d<\/p>\n He added: \u201cThe government will be called on again to protect pensioners from this impact but with seemingly few ways to control the rise in pensioner incomes, taxation is the only tool left.<\/p>\n \u201cWe should also expect the income tax from pensioners to rise in coming years as more income will be taken from pensions. Taking pension income is the key way to protect pension benefits from the impact of the Inheritance Tax Rules on unspent pension funds due to come in from April 2027.\u201d<\/p>\n Under the Triple Lock<\/a> the New and Basic State Pensions increase each year in-line with whichever is the highest between the average annual earnings growth from May to July (4.7%), Consumer Price Index (CPI) inflation rate in the year to September, or 2.5 per cent. Additional State Pension elements and deferred State Pensions rise each year with the September CPI figure.<\/p>\n The CPI figure for August was 3.8 per cent and pension experts now say it looks highly unlikely CPI will be higher than the earnings growth<\/a> rate.<\/p>\n This means people on the full New State Pension could see payments rise by over \u00a3500 next year under the earnings growth. An uplift of 4.7 per cent would increase the full New State Pension to \u00a3241.05 per week and \u00a3184.75 for those on the maximum Basic State Pension.<\/p>\n It\u2019s important to remember the amount someone receives depends on their National Insurance contributions. To receive the full, new State Pension you need around 35 years\u2019 worth, but this may differ if you were \u2018contracted out\u2019.<\/a><\/p>\n If September\u2019s inflation figure matches the Bank of England\u2019s projection of 4 per cent, the State Pension would increase by around \u00a3500 from April 2026 – lifting it to \u00a312,534 per year.<\/p>\n The projected uprating leaves just \u00a336 before the Personal Allowance income threshold of \u00a312,570 is exceeded which would see more pensioners pay tax in retirement.<\/p>\n State Pension uprating predictions for 2026\/27<\/p>\n The CPI for September will be published on October 22 and is forecast to be 4 per cent.<\/p>\n Chancellor Rachel Reeves will confirm the annual uprating at the Autumn Budget on November 26. An uprating of 4.7 per cent on the current State Pension would see people receive the following amounts.<\/p>\n Full New State PensionWeekly: \u00a3241.05 (from \u00a3230.25)Four-weekly pay period: \u00a3964.20Annual amount: \u00a312,534Full Basic State PensionWeekly: \u00a3184.75 (from \u00a3176.45)Four-weekly pay period: \u00a3739Annual amount: \u00a39,607State Pension and tax<\/p>\n Guidance on GOV.UK<\/a> states: \u201cYou pay tax if your total annual income adds up to more than your Personal Allowance. Find out about your Personal Allowance and Income Tax rates.<\/p>\n Your total income could include:<\/p>\n the State Pension you get – Basic or New State PensionAdditional State Pensiona private pension (workplace or personal) – you can take some of this tax-freeearnings from employment or self-employmentany taxable benefits you getany other income, such as money from investments, property or savingsCheck if you have to pay tax on your pension<\/p>\n Before you can check, you will need to know:<\/p>\n if you have a State Pension or a private pensionhow much State Pension and private pension income you will get this tax year (April 6 to April 5)the amount of any other taxable income you\u2019ll get this tax year (for example, from employment or state benefits)<\/p>\n You cannot use this tool if you get:<\/p>\n any foreign incomeMarriage AllowanceBlind Person\u2019s Allowance<\/p>\n Use this online tool at GOV.UK<\/a> to check if you have to pay tax on your pension.<\/p>\n The full guide to tax when you get a pension can be found on GOV.UK here.<\/a><\/p>\n Join the conversation on our Money Saving Scotland Facebook group<\/a> for money-saving tips, the latest State Pension and benefits news, energy bill advice and cost of living updates.<\/p>\n Sign up to our Record Money newsletter and get the top stories sent to your inbox daily from Monday to Friday with a special cost of living edition every Thursday – sign up here<\/a>.<\/p>\n You can also follow us on X (formerly Twitter) @Recordmoney_<\/a> for regular updates throughout the day or get money news alerts on your phone by joining our Daily Record Money WhatsApp community<\/a>.<\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2025\/08\/0_DR-MOney.png\")
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