State Pension heads over the tax line — and HMRC bills by letter

What the figures say

On 15 September 2026 the Office for National Statistics (ONS) published average earnings for May to July 2026. Total pay, including bonuses, grew 3.9%. If that figure sets next April’s rise, the full new State Pension will sit about £467 above the frozen personal allowance for the first time — and because nothing is deducted before the money reaches the bank, the tax on it arrives as a letter from HM Revenue and Customs (HMRC).

That May-to-July window matters because of the triple lock. The State Pension rises each April by the highest of three things: growth in average weekly total pay over that window, inflation in the year to September, or 2.5%. The earnings leg is now known. The other two are not.

Add 3.9% to the current full new State Pension of £241.30 a week and you get £250.71. (The published rate is rounded to the nearest 5p, so expect it a penny either side.) Over 52 weeks that is £13,036.92. The personal allowance — what you can have before income tax starts — is £12,570, and is frozen there until April 2031.

	2026/27	If 3.9% wins
Full new State Pension, a week	£241.30	£250.71
Full new State Pension, a year	£12,547.60	£13,036.92
Personal allowance	£12,570	£12,570
Taxable	nothing	£466.92

Twenty per cent of £466.92 is £93.38. For the first time, a full new State Pension on its own would sit above the line.

The tax does not come off the payment

This is the part the coverage skips. The State Pension is taxable, but nothing is taken off before it reaches the bank account. HMRC collects it somewhere else.

If you have a workplace or private pension, or a wage, HMRC changes your tax code and that other income shrinks instead. GOV.UK puts it plainly: “Your private pension provider will usually take off any tax you owe before they pay you. This includes any tax you owe on your State Pension.” Your State Pension looks untouched. The other pension takes the hit, and people ring the wrong organisation to ask why.

If the State Pension is your only income, there is no other code to put it in. GOV.UK again: “If you go over your Personal Allowance and you have tax to pay, HMRC will send you a Simple Assessment tax bill.” A letter, and a sum to pay — for people who in many cases have never dealt with HMRC directly in their lives.

What is not settled

The uprating is not confirmed. September’s inflation figure is published on 21 October 2026, and if it beats 3.9% the rise is bigger and so is the tax.

The allowance could still move. Chancellor John Healey delivers his Budget on 28 October 2026, a week after that inflation figure.

And there is a promise. An HM Treasury spokesperson, quoted on 2 September 2026, said pensioners “whose only income is the full new or basic state pension without any increments will not pay income tax and we are committed to that over this Parliament”. Read the wording twice. Without any increments. A protected payment, a deferral uplift, an old SERPS addition, some savings interest, a few shifts of work — any of those and the sentence does not cover you. The Treasury has not said how the promise will be delivered. Its own figure for this April’s triple lock rise was up to £575.

Our workings are set out at /methodology and every document we use is listed at /sources.

Where these figures come from

• UK labour market: September 2026 — Office for National Statistics
• The new State Pension: what you'll get — GOV.UK
• Tax when you get a pension: how your tax is paid — GOV.UK
• Pay your Simple Assessment tax bill — GOV.UK
• State pensioners get update on tax system changes as new rules loom — Brit Brief
• Government confirms date for Autumn Budget 2026 — Professional Pensions

Every figure traces to a dated document — the line this section is named after. If one here is wrong, tell us and it gets fixed publicly. Work out your own figures.