HMRC tax warning for pensioners with more than £1,600 in savings
An HMRC tax warning has been issued to 340,000 state pensioners who could face a bill for the first time due to the Triple Lock's £460 increase.
Steve Webb, former pensions minister and member of the Liberal Democrats, has stated that around 240,000 individuals are at risk of exceeding the personal allowance threshold of £12,570 next year. This would mean they'd have to start paying tax on their income.
The expected rise in the Triple Lock next April, estimated at £460, will push those with a state pension worth £11,962.60 closer to the threshold, leaving those with £1,600 in savings potentially facing a tax bill.
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Sir Steve commented: "From next year, 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."
Victoria Harris, co-founder of The Curve Platform, discussed the potential revision of the earnings figure for the triple lock. She said: "The potential revision of the earnings figure for the triple lock is a hot topic. While it's too early to pin down an exact number, we could be looking at an increase of around 7 to 8 per cent based on current projections," as reported by Birmingham Live.
"This would be a significant boost for pensioners."
"We must consider the broader economic implications. Inflation is the wild card here. If it continues to rise in the coming months, we might see even higher pension increases."
Yiannis Zourmpanos, a financial consultant and senior contributor at Bountii, commented: "This could be a double-edged sword - great for pensioners in the short term, but potentially challenging for the economy as a whole."
"The Office for National Statistics (ONS) often revises its earnings data, which means the state pension increase you're expecting might not be the one you'll get."
"The ONS has been known to provide updated figures that more accurately reflect the actual earnings growth over a given period. This means that by the time the final calculations are made, we could see a different percentage being used for the state pension uprating."