British state pensioners receiving the new state pension will see a £562 annual increase next year following confirmation of the state pension rate for 2026/27 under triple lock provisions.

The triple lock guarantees pension increases annually in accordance with whichever is highest among inflation, wage growth, and 2.5%.

With wages rising by 4.7%, this figure will determine the latest uplift.

A 4.7% increase will elevate the annual rate to £12,535 – representing a £562 boost.

The enhanced payments will commence next April, reports the Express.

Pension specialists at Spencer Churchill Claims Advice described this as a “meaningful increase, especially for those relying heavily on it to cover everyday expenses.”

Nevertheless, it will also propel pensioners with supplementary income towards income tax liability for the first time due to frozen tax thresholds.

Freezing tax thresholds means that as earnings rise, more individuals will be required to pay tax or pay it at an elevated rate, without the Government actually needing to raise taxes.

Mike Amber, retirement savings director at Standard Life, commented: “For pensioners paying the higher rate of tax, the value of the £561.60 rise will be eroded to around £337.”

A Spencer Churchill Claims Advice spokesperson added: “The rise also brings the state pension close to the frozen personal tax allowance, meaning more retirees could end up paying income tax on their pension alone.

“Pension rises look good on paper, but frozen personal allowances mean retirees don’t always feel the full benefit.

“This is called fiscal drag – where an increase in pension income simply pushes people into tax thresholds.

“Many pensioners who only rely on the state pension will soon find themselves paying tax for the first time, while those with workplace or private pensions are already there.”

Experts have also cautioned that the extra money will likely be used to cover escalating living costs and as a result, won’t make much of a difference, according to BirminghamLive.

Steve Webb, former pensions minister and partner at LCP, stated: “Although an extra £560 per year will be welcomed, for most pensioners this will be largely eaten up by the increase in the cost of living.

“The Bank of England forecasts that inflation will hit around 4 per cent in September, gobbling up most of the 4.7 per cent state pension rise, leaving a real increase of less than 1 per cent.”