Tax rules for pensions clarified

HMRC has clarified the rules regarding tax on state pensions and other pension income following a taxpayer's inquiry about their self-invested personal pension. The taxpayer asked whether an ad hoc payment would be treated as a regular monthly payment. HMRC said it will use the information it receives from pension providers and adjust the person's record accordingly. The tax office confirmed that a one-off payment would be taxed at the basic rate if the taxpayer is not in the higher rate band.