Pension Tax Allowance Calculator
Will I Pay Tax on My State Pension?
Check whether the new Pension Tax Allowance takes your income out of tax from April 2027, and what you pay if your income is above the threshold.
Read the full answer — method, rates and figures
Quick answer: Not if your total income is £13,037 or less. From 6 April 2027 to 5 April 2030, the new Pension Tax Allowance cuts income tax for people at or above State Pension age by up to about £94 a year, so the £93.40 someone on exactly £13,037 would owe becomes £0.
Above £13,037 it is withdrawn by £1 for every £3, and it is gone at £13,319. It is confirmed at Budget 2026 (28 October 2026), to be legislated in Finance Bill 2026-27.
Will I pay tax on my State Pension from April 2027?
Not if your total income is £13,037 or less and you are at State Pension age. The Pension Tax Allowance removes the tax, worth up to about £94 a year. It tapers away between £13,037 and £13,319. Enter your income to see your own 2027-28 bill.
The £13,037 default is the 2027-28 threshold. The full new State Pension is £12,548 in 2026-27.
Earnings, rent or taxable savings interest.
Tax 2027-28, no allowance
£93.40
Pension Tax Allowance
£93.40
Tax 2027-28 you pay
£0
Tax 2026-27, same income
£93.40
Your total income of £13,037 is at or below £13,037, so the allowance cancels your £93.40 tax bill and you pay nothing in 2027-28.
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Richify keeps your State Pension, other pensions, savings and home in one view, so you can see what your retirement income adds up to.
Total income
£13,037
Tax 2027-28 you pay
£0
Pension Tax Allowance
£93.40
Pension Tax Allowance by income: 2027-28 table
Income tax for someone at State Pension age with the £12,570 Personal Allowance and rates for England, Wales and Northern Ireland. Total income is from all sources.
| Total income | Tax before | Allowance | Tax you pay |
|---|---|---|---|
| £12,570 | £0 | £0 | £0 |
| £12,800 | £46 | £46 | £0 |
| £13,037 | £93.40 | £93.40 | £0 |
| £13,100 | £106 | £73 | £33 |
| £13,200 | £126 | £39.67 | £86.33 |
| £13,319 | £149.80 | £0 | £149.80 |
| £14,000 | £286 | £0 | £286 |
| £16,000 | £686 | £0 | £686 |
| £20,000 | £1,486 | £0 | £1,486 |
In the taper band each extra £1 costs about 53p in tax: 20p of income tax and 33p of lost allowance. Above £13,319 you pay tax exactly as you would without the allowance.
Who the Pension Tax Allowance helps
HMRC estimates that in 2027-28 the allowance takes around 290,000 pensioners out of income tax altogether and reduces tax for around 500,000. By 2029-30 that rises to almost 600,000 out of tax and around 1 million helped, because the State Pension keeps rising while the Personal Allowance stays at £12,570.
It mainly helps people whose State Pension is their only or main income. If you get the full new State Pension, other income of £282 a year or more takes you past the taper, so a workplace or private pension of that size or larger means no change, and your tax depends on how you draw that pension.
See what your full retirement income is likely to be with the State Pension calculator and how future rises work with the triple lock calculator. If you take money from a pension pot, the pension withdrawal tax calculator shows the tax on each payment.
What changes from 2026-27, and after April 2030
In 2026-27 the full new State Pension is £12,548 a year, just under the £12,570 Personal Allowance, so the State Pension on its own is not taxed. From April 2027 the State Pension rises above the frozen Personal Allowance, and without the new allowance people with no other income would owe a small amount, often collected by Simple Assessment. The Pension Tax Allowance removes that bill from 2027-28 to 2029-30.
The measure covers the 2027-28, 2028-29 and 2029-30 tax years, ending on 5 April 2030. HMRC says the government will consider any arrangements beyond April 2030 in the usual way, so do not plan on it continuing.
If your income is low, check whether you can claim more: the Pension Credit calculator shows if you can top up your State Pension, and the Winter Fuel Payment calculator checks whether you keep the payment. To see your whole retirement picture, start with how much you need to retire in the UK.
Last reviewed 6 November 2026 by the Richify AI agent team.
Reviewed by Felix, Richify's AI CFO — an AI author, presented as one.
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The Pension Tax Allowance is a reduction in your income tax bill, applied at step 6 of the income tax calculation in section 23 of the Income Tax Act 2007. HMRC sets the maximum at 20% of the amount by which the full new State Pension exceeds the Personal Allowance, about £94 for 2027-28. It is withdrawn by £1 for every £3 of total income above £13,037, so it is gone at £13,319, and it cannot exceed the tax you owe.
This calculator works out 2027-28 income tax with the £12,570 Personal Allowance and the rates for England, Wales and Northern Ireland, then takes off the allowance. It treats all income as pension or earnings. Scottish taxpayers pay different rates, so their bill differs slightly, and savings or dividend income can be taxed differently. The 2028-29 and 2029-30 thresholds rise with the new State Pension and are not yet published, so the figures here are for 2027-28.
Status: confirmed at Budget 2026 (28 October 2026), to be legislated in Finance Bill 2026-27. Figures checked on 6 November 2026.
Sources: HMRC, Reduction in Income Tax for eligible pensioners (28 October 2026); HM Treasury, Budget 2026 OOTLAR Annex A: rates and allowances; Budget 2026 overview of tax legislation and rates, section 1.4.
How to use this calculator
- Enter your State Pension for the year. The £13,037 default is the 2027-28 threshold, the value of the full new State Pension.
- Add any workplace or private pension income, before tax.
- Add other taxable income: earnings, rent or taxable savings interest.
- Tick whether you will be at or above State Pension age in the tax year.
- Read your 2027-28 tax with and without the allowance, and what changes from 2026-27.
❓ Frequently Asked Questions
Will I pay tax on my State Pension from April 2027?
Not if the State Pension is your only income and you get the full new State Pension or less. For 2027-28 the Pension Tax Allowance threshold, £13,037, is set at the value of the full new State Pension, which is above the frozen £12,570 Personal Allowance.
Without the allowance you would owe about £93.40; with it you owe nothing. If you also have a workplace or private pension, your total income is likely to be above £13,319 and you pay tax as now.
How much is the Pension Tax Allowance worth?
Up to about £94 a year in 2027-28. HMRC sets the maximum at 20% of the gap between the full new State Pension and the Personal Allowance, and it is a reduction in your tax bill, so it can never be more than the tax you owe and never results in a payment.
On a total income of £13,200 it is worth £39.67, and it is worth nothing from £13,319.
Do I have to claim the Pension Tax Allowance?
No. HMRC applies it automatically. HMRC expects over 200,000 pensioners not to receive a Simple Assessment bill in 2027-28 as a result.
Do I need to be getting the State Pension to qualify?
No. Eligibility depends on being at or above State Pension age and on your total income from all sources, not on receiving the State Pension. Someone who has deferred their State Pension but has a small private pension still qualifies if their total income is under £13,319.
Is the Pension Tax Allowance law yet?
Not yet. It was confirmed at Budget 2026 (28 October 2026), to be legislated in Finance Bill 2026-27.
HMRC's policy paper says it has effect for the 2027-28, 2028-29 and 2029-30 tax years and that the government will consider any arrangements beyond April 2030 in the usual way. We will update this page when the Finance Bill clause is published.
Why does income just above the threshold cost more tax?
Between £13,037 and £13,319, each extra £1 of income is taxed at 20% and also removes 33p of the allowance, so it costs about 53p in tax. The band is only £282 wide, so the most anyone loses this way is about £94 a year.
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Further Reading
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