Starting in April 2026, over nine million state pensioners in the UK will be subject to new tax rules. The change comes as the state pension, boosted by the triple lock system, exceeds the personal income tax allowance, pushing many pensioners into the tax bracket for the first time. According to The Sun, this shift has raised concerns among retirees who rely solely on the state pension to make ends meet.
The Triple Lock and Its Impact on State Pensions
The triple lock, which guarantees that the state pensioners’ state pension increases by the highest of inflation, wages, or 2.5%, is set to rise by 5.5% in April 2026.
As a result, the full state pension will increase to £12,631, breaking the personal allowance threshold of £12,570. This means that pensioners who rely solely on the state pension will be liable for taxes on the additional £61 above the threshold.
How the Tax Changes Affect Pensioners
The rise in the state pension comes at a time when the government’s income tax thresholds remain frozen at £12,570 until 2028.
With pensions set to rise and more people crossing the tax threshold, an increasing number of pensioners will be required to pay tax.
For those earning solely from the state pension, this will typically result in a small tax bill, with many paying around £12 on the £61 that exceeds the personal allowance.
Steve Webb, partner at pension consultants LCP, commented on the ongoing trend:
Year after year, more and more pensioners are being dragged into the tax net, and the next couple of years look to be no exception. With a 5.5% rise in April 2026, someone with no income other than a full new state pension will be paying tax for the first time.
He continued :
For most pensioners with simple tax affairs, this will mean an end-of-year tax bill sent out to them by HMRC, though they should not have to fill in a tax return. Many of these bills will be for very small amounts.
The Broader Tax Landscape
The freeze on income tax thresholds has been in place since 2021. While Chancellor Rachel Reeves confirmed that tax thresholds will rise in line with inflation from 2028 onward, state pensioners will continue to face financial pressure in the meantime, especially those with additional income from private pensions or part-time jobs.
Chancellor Reeves stated :
There will be no extension of the freeze in income tax and National Insurance thresholds beyond the decisions of the previous government.
From 2028-29, personal tax thresholds will be uprated in line with inflation once again.
Government Commitments to Pensioners
Despite these changes, the government has emphasised its commitment to supporting pensioners. According to an HMRC spokesperson :
We are committed to helping our pensioners live their lives with dignity and respect, which is why we have frozen fuel duty and increased the state pension to leave pensioner couples up to £88 better off a month.
Our commitment to the triple lock means millions will see their pension rise by up to £1,900 this parliament.
As more pensioners are drawn into the tax system, the financial implications for retirees will likely remain a key issue in the years to come, particularly for those with fixed incomes.
