{"id":121813,"date":"2026-06-16T11:15:00","date_gmt":"2026-06-16T10:15:00","guid":{"rendered":"https:\/\/en.econostrum.info\/uk\/?p=121813"},"modified":"2026-06-16T10:42:32","modified_gmt":"2026-06-16T09:42:32","slug":"pensioners-hoping-for-a-25140-tax-break","status":"publish","type":"post","link":"https:\/\/en.econostrum.info\/uk\/pensioners-hoping-for-a-25140-tax-break\/","title":{"rendered":"Pensioners Hoping for a \u00a325,140 Tax Break Get a Major Treasury Response"},"content":{"rendered":"\n

The Government has ruled out plans to double the personal tax allowance for pensioners to \u00a325,140 following a parliamentary debate triggered by a petition signed by more than 120,000 people<\/strong>. Ministers said the proposal would cost several billion pounds a year and is not being considered.<\/p>\n\n\n\n

The debate highlighted growing concerns over the interaction between the state pension triple lock and frozen income tax thresholds, with MPs from several parties arguing that increasing numbers of pensioners are being drawn into the tax system.<\/p>\n\n\n\n

The issue was discussed in Westminster Hall on 15 June after an e-petition called for the tax threshold for state pensioners to be raised from \u00a312,570 to \u00a325,140. Supporters argued that many retirees are facing tax liabilities as state pension payments <\/strong>rise while personal allowances remain unchanged.<\/p>\n\n\n\n

Campaigners and several MPs said the current situation is creating administrative and financial pressures for older people, particularly those with modest private or occupational pensions alongside their state pension entitlement.<\/p>\n\n\n\n

MPs Raise Concerns over Pension Taxation and Frozen Thresholds<\/strong><\/h2>\n\n\n\n

Opening the debate, Conservative MP John Lamont<\/a> argued that more pensioners are becoming liable for income tax because state pension payments have increased under the triple lock while personal tax allowances have remained frozen.<\/p>\n\n\n\n

According to Lamont, some pensioners are now required to complete self-assessment tax returns, while others receive unexpected tax demands from HM Revenue and Customs. He said many retirees have limited savings<\/strong> and relatively modest incomes, making such tax obligations difficult to manage.<\/p>\n\n\n\n

The petition was created by Tim Mason<\/strong>, who argued that pensioners who worked and saved throughout their lives are finding that their private or occupational pensions are increasingly subject to taxation once state pension payments are added to their income.<\/p>\n\n\n\n

Conservative MP Mark Garnier<\/a> directly asked whether the Government would consider increasing the tax-free threshold for pensioners to \u00a325,140 and maintaining it at twice the level available to working-age taxpayers. He noted that the full state pension is approaching the current personal allowance threshold.<\/p>\n\n\n\n

Liberal Democrat MP Charlie Maynard<\/a> also criticised the continued freeze on tax thresholds. According to Maynard, frozen allowances act as a \u201cstealth tax grab\u201d by bringing more pensioners and lower-income earners into the tax system. He pointed out that the full new state pension for 2026-27 is \u00a312,547.60 annually, compared with a personal allowance of \u00a312,570.<\/p>\n\n\n\n

\"\"
MPs warn frozen tax thresholds are pulling pensioners into income tax \u00a9 Shutterstock<\/em><\/figcaption><\/figure>\n\n\n\n

Treasury Dismisses Proposal but Announces Administrative Changes<\/strong><\/h2>\n\n\n\n

Responding on behalf of the Government, Pensions Minister Torsten Bell rejected the petition\u2019s central proposal. He told MPs that \u201cno political party will deliver a doubling of the personal allowance for pensioners<\/em>\u201d, arguing that the measure would carry a fiscal cost of several billion pounds each year.<\/p>\n\n\n\n

According to Bell, the Government\u2019s priorities remain increasing the state pension through the triple lock and supporting the National Health Service. He also stated that pension income has historically been treated as taxable income within the UK tax system.<\/p>\n\n\n\n

Bell said the full new state pension is projected to rise by around \u00a32,100<\/strong> during the current Parliament as a result of the Government\u2019s commitment to maintain the triple lock. He also noted that both the basic and new state pensions increased by 4.8% in April, boosting pensioner incomes by up to \u00a3575 annually.<\/p>\n\n\n\n

While rejecting any increase in the personal allowance, the minister confirmed that the forthcoming Finance Bill will include measures aimed at reducing administrative burdens for older taxpayers. According to Bell, pensioners will no longer be required to use the \u201csimple assessment\u201d process to pay small amounts of tax from the 2027-28 tax year.<\/p>\n\n\n\n

Although MPs disagreed on how to address the issue, participants from across Parliament broadly agreed that pensioners should be able to retire with dignity, security and peace of mind.<\/p>\n","protected":false},"excerpt":{"rendered":"

More than 120,000 people backed a proposal to dramatically raise the tax-free allowance for pensioners. The issue reached Parliament, prompting a direct response from ministers that could have major implications for retirement incomes.<\/p>\n","protected":false},"author":10,"featured_media":121816,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[29],"tags":[],"class_list":["post-121813","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-taxation","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33","no-featured-image-padding"],"_links":{"self":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/121813","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/comments?post=121813"}],"version-history":[{"count":2,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/121813\/revisions"}],"predecessor-version":[{"id":121817,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/121813\/revisions\/121817"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media\/121816"}],"wp:attachment":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media?parent=121813"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/categories?post=121813"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/tags?post=121813"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}