A major budget announcement aims to ease financial pressure on low-income pensioners by increasing the state pension by nearly £500, but the rise risks pulling around a million recipients into paying income tax for the first time. The government is set to offset this by raising the tax-free personal allowance threshold to prevent those on modest incomes from facing unexpected tax bills. With the full pension now exceeding the current tax-free limit, the move could affect those who have previously avoided income tax on their state payments. Details on the exact adjustments are expected to be confirmed shortly.
PM says talking about changing the relationship with the bloc would not be divisive but ‘can start to bring people together’The Times is reporting this morning that the tax allowance for low-income pensioners will be raised in the budget so that they do not have to pay income tax on their state pension.As Steven Swinford explains in his story:John Healey is expected to confirm on Wednesday that the full state pension will rise by £489 to £13,036 – equivalent to 3.9%.However, the rise will push about one million people on low incomes who rely on the state pension above the £12,570 personal allowance threshold, meaning they would be dragged into paying income tax. Continue reading...
