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Seven in 10 Pensioners Must Now Pay Income Tax in New Record, HMRC Data Reveals
Frozen tax thresholds and rising State Pension payments are pushing more retirees into the tax system, with over-65 taxpayers forecast to top 10.2 million.
- HMRC projects 10.2 million people aged 65 and over will pay income tax in 2026-27, up from 9.58 million the previous year, marking record pensioner taxpayer numbers.
- Frozen personal allowances at £12,570 since 2021, combined with annual State Pension increases, have pulled more pensioners into the tax system, Sir Steve Webb, former pensions minister, noted the "surge in older people paying income tax is continuing."
- Tax and financial planning expert Shaun Moore at Quilter warned that "what were once considered tax rates for wealthier people are increasingly reaching a much broader group," with nearly one-quarter of all taxpayers now over State Pension age.
- From April 2027, the full State Pension rate is expected to exceed the personal allowance for the first time, prompting the Government to announce plans for a system ensuring pensioners avoid tax liability solely from this increase.
- Working past State Pension age contributes to rising pensioner taxpayer numbers as the population ages, though David Brooks, head of policy at Broadstone, noted many pensioners benefit from occupational and private pension savings built over decades.
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Total News Sources17
Leaning Left2Leaning Right2Center11Last UpdatedBias Distribution74% Center
Bias Distribution
- 74% of the sources are Center
74% Center
13%
C 74%
13%
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