State pensioners face a “significant” tax bill risk as a payment change comes in. Thanks to the Triple Lock, Department for Work and Pensions (DWP) state pension payments are to increase 4.8 percent this April.

The pay boost will increase the full new state pension from the current £230.25 a week up to £241.30 a week, while the full basic state pension will rise from the current £176.45 a week to 184.90 a week.

The full new state pension, worth £12,547.60 a year from April, will soon use up all the £12,570 personal allowance, meaning those on the full new amount alone will have to pay income tax.

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As the triple lock moves up payments each year by a minimum of 2.5 per cent, the full new state pension will definitely use up all the personal allowance from April 2027.

The triple lock mandates that payments go up in line with whichever is highest: the rise in average earnings, the rate of inflation, or the minimum 2.5 percent.

Derence Lee, chief finance officer at savings provider and insurance firm Shepherds Friendly, said: “Due to the extremely high levels of inflation the UK has experienced since 2020, state pensions have been increasing at a rate that some experts believe to be unsustainable in the long term.

“With pensions expected to surpass the frozen tax-free allowance limit next year, which will remain unchanged by the Government until 2028, more retirees will be pushed into the tax-paying bracket.

“As a result, pensioners should begin to take into account that they may soon need to pay income tax on their pensions should no changes be made to current status-quo.”

The expert said: “While the triple lock has been helpful in ensuring retirees’ incomes keep up with the cost of living, taxing pensioners could have significant financial implications, particularly for those who rely heavily on their pensions to cover essential living costs and make ends meet.”