Pensioners are facing uncertainty as their state payments are set to increase by 3.9% in April, taking the annual amount just above £13,000 and into the personal allowance threshold of £12,570. Business Secretary Jonathan Reynolds refused to clarify whether pensioners who rely solely on the state pension would be exempt from filing tax returns when they exceed this threshold. Pensions minister Torsten Bell assured that those slightly over the threshold will not face "the administrative burden of paying small amounts of tax" but did not provide further details, leaving many retirees confused about their future tax liabilities.
Written by the local model on 2026-09-16,
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Leaning score withheld for article 9682: score contradicts its own evidence · logged 2026-09-16
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Pensioners face uncertainty over their tax bills today after it emerged state payments are set to rise 3.9 per cent in April.
asserted
payments → see → April
The slated increase would take the level to just over £13,000 from April - above the personal allowance threshold of £12,570 for the first time.
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increase → slat → time
Rachel Reeves previously suggested there would be a fix to prevent retirees who rely solely on the state pension having to fil tax returns and pay HMRC.
uncertain
who → suggest → HMRC
But Business Secretary Jonathan Reynolds raised eyebrows this morning as he refused to say whether the commitment stood.
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commitment → raise → eyebrows
'I'm sorry, that is for the Chancellor and for a Budget,' he told BBC Breakfast.
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he → tell → Breakfast
Pensions minister Torsten Bell tried to calm nerves later by insisting that those who 'only just' exceed the personal allowance will not face 'the administrative burden of paying small amounts of tax in this Parliament'.
However, he declined to give details of what that meant, saying Chancellor John Healey would 'set out further details on how that commitment will be delivered at the Budget'.
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commitment → try → Budget
Sources suggested the authorities were still 'figuring it out'.
uncertain
authorities → suggest → it
Pensions minister Torsten Bell insisted those who 'only just' exceed the personal allowance will not face 'the administrative burden of paying small amounts of tax in this Parliament'
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who → insist → Parliament
Business Secretary Jonathan Reynolds stonewalled as he was asked about an expected 3.9 per cent increase in the state pension
'
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he → stonewall → pension
The majority of pensioners in this country don't just rely on the state pensions.
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majority → rely → pensions
Some do, I accept that, but the majority don't.
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majority → do → that
'So I think sometimes when this is looked at, we're focusing just on the state pension side of this.
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we → think → this
You've got to consider the full range of income retired people in the UK have, living the good lives they deserve in their retirement.
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they → get → retirement
The state pension 'triple lock' was introduced by the Coalition more than a decade ago.
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lock → introduce → Coalition
It means the state pension increases every year by the highest of inflation, average earnings growth or 2.5 per cent.
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pension → mean → inflation
Earnings figures published this morning show wage growth of 3.9 per cent in the three months to July.
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figures → publish → July
Unless inflation surges from its current rate of 2.9 per cent, that figure will be used to calculate the state pension increase from April.
If confirmed, the full new state pension will rise from £241.30 per week to £250.70.
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pension → surge → 250.70
The government calculates the annual pension by applying the uprating to the weekly payment, converting to a day rate and then multiplying by 365.25 to account for leap years.
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government → calculate → years
That gives a figure of £13,081.17.
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That → give → 13,081.17
However, HMRC calculates the pension's annual value for tax purposes based on 51 weeks at the new level, and one week at the old level.
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HMRC → calculate → level
Shadow chancellor Andrew Griffith said: 'Unless Burnham acts, Labour are about to tax pensioners.
'
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Labour → say → pensioners
People living on nothing but their state pension are now facing a tax bill for the first time ever.
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People → live → time
Many will spend the last years of their lives filing tax returns or hanging on HMRC telephone helplines.
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Many → spend → helplines
'Rather than reform welfare, this government will tax everything from your family holiday to your Nan's pension.'
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government → tax → pension
Rachel Vahey, head of public policy at AJ Bell, said: 'Based on today's earnings figures for July, the odds are that pensioners will be receiving just shy of £500 extra in their state pension next year.
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pensioners → say → pension
Although we still need to see September's inflation figure and any revisions to July's earnings growth before we know for definite how much it will increase by in 2027, it's looking very likely that the value of the full new state pension will surge past £13,000 – and the personal allowance – for the first time.
'
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value → need → time
Even using the lowest measure of 2.5 per cent under the triple lock means the full state pension amount would exceed the personal allowance of £12,570.
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amount → use → 12,570
The government has said people in receipt of state pension income only above the personal allowance will not have to pay income tax on the benefit, although details on exactly how this will work remain thin on the ground.'
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this → say → ground
The Aporia
