State pension payments are set to rise by 4% next year, increasing the full new state pension from £221.20 to £230.05 a week. This change will push approximately 340,000 pensioners over the personal allowance threshold of £12,570, resulting in them paying income tax for the first time since retirement. Sir Steve Webb, a former Pensions Minister, noted this means "roughly three in four" UK pensioners will have to pay income tax, "and just over a third of a million will be dragged into the tax net for the first time since they retired." Official figures show that 72% of pensioners already pay income tax, with the basic rate at 20% for income up to £50,270.
