![\"HMRC](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/01\/0_hmrc2.jpg\")
<\/p>\nThere were fears the state pension would cross the HMRC Personal Tax-Free Allowance threshold.<\/p>\n
HMRC set to exempt one million state pensioners from tax rule(Image: )<\/p>\n
HMRC is set to exempt one million state pensioners from a tax rule – in major respite for retirees. <\/a>After the Department for Work and Pensions ( DWP<\/a> ) Triple Lock hike was announced, there were fears the state pension would cross the HMRC Personal Tax-Free Allowance threshold.<\/p>\n But Labour Party<\/a> Chancellor Rachel Reeves later ruled this out. Now, HMRC has been quizzed over how the exemptions will work.<\/p>\n Cerys McDonald, director of Individuals Policy, said there are around 800,000 and a million pensioners whose only income is the state pension. She said: “We would expect this to go through the next finance bill in the Autumn but we have mobilised a project team already in anticipation of having to make this change.<\/p>\n READ MORE Guinness bringing in unwelcome change for drinkers from April<\/a><\/p>\n “The mitigation that we would normally use to recover this tax is simple assessment, normally we wouldn’t be processing that for 2027\/2028 until after the 2028 tax year, so we’ve got a decent run in here.”<\/p>\n Ms McDonald told the committee: “There’s clearly a lot of detail to still work through and she [the Chancellor] has said that that detail will be set out in due course.” She said the new system will be “operable from April 2027”.<\/p>\n Ms Reeves said to BBC<\/a> and ITV<\/a> Martin Lewis previously: “And so I make that commitment for this Parliament. You’re right, 2027 looks like the time that it will cross over. We are working on a solution, as we speak, to ensure that we’re not going after tiny amounts of money.”<\/p>\n Mr Lewis, 52, replied: “But people will have to pay the tax. They just won’t have to do a return? Or will they not have to pay the tax?”<\/p>\n The Chancellor told Mr Lewis: “In this Parliament, they won’t have to pay the tax.”<\/p>\n The Chancellor went on, and added: “You know, further out, I’m not about to make any commitments on that. But we’re just looking at a simple workaround at the moment.”<\/p>\n Martin replied: “Okay. So I hadn’t actually got that from the Budget. So that’s really good to have clarity that they won’t be paying the tax.”<\/p>\n","protected":false},"excerpt":{"rendered":"There were fears the state pension would cross the HMRC Personal Tax-Free Allowance threshold. HMRC set to exempt…\n","protected":false},"author":2,"featured_media":376394,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[84,4176,2218,4174,4175,56,54,55],"class_list":["post-376393","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-finance","tag-hmrc","tag-personal-finance","tag-personalfinance","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/376393","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=376393"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/376393\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/376394"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=376393"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=376393"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=376393"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}