Pensioners get tax credit

Commenting on the pensions tax allowance announced in today’s Budget, Rachel McEleney, tax director at Deloitte UK, said:

“Individuals who have reached state pension age will now be entitled to a tax credit of up to £94 from 6 April 2027, known as the pensions tax allowance. This is equal to the tax that would otherwise arise on a year’s worth of the new state pension, which is £13,037 in 2027/28. This ensures that pensioners whose only income consists of the state pension without increments will remain outside the scope of income tax.

“To ensure that this change is targeted at low-income pensioners, the tax credit will be tapered by £1 for every £3 of income between £13,037 and £13,319. The aim of this policy is to reduce the potential administrative burden of having to collect small amounts of tax from a large population of pensioners.”

ENDS

Note to editors

Deloitte spokespeople

Deloitte has a range of spokespeople available to comment on today’s Budget. They can be reached on 02920 927541 or one of the following numbers: 

• Amanda Tickel – head of tax and trade policy (+44 7920 270964)
• Debo De – chief economist (+44 7887 629107)
• Rachel McEleney – personal tax (+44 7774 337581)
• Alison Lobb – corporate tax (+44 7774 337581)
• Michael Nicolaides – employment tax (+44 7586 511104)
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• Annis Lampard – private tax (+44 7824 895798)
• Richard Bray – Places (+447990434703)
• Ian Goodsell – Private client (+447990434703)

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