{"id":569609,"date":"2025-11-14T10:14:18","date_gmt":"2025-11-14T10:14:18","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/569609\/"},"modified":"2025-11-14T10:14:18","modified_gmt":"2025-11-14T10:14:18","slug":"pensioners-and-more-workers-to-pay-tax-by-2027-due-to-freeze-on-tax-thresholds","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/569609\/","title":{"rendered":"Pensioners and more workers to \u2018pay tax by 2027 due to freeze on tax thresholds\u2019"},"content":{"rendered":"

\n\t\t\t\t\tThe freeze on thresholds will mean that by 2027, everyone receiving the new state pension will be charged income tax\t\t\t\t\t <\/p>\n

Pensioners and workers on the minimum wage are being sucked into paying income tax by a freeze on tax thresholds<\/a>, a think-tank has warned.<\/p>\n

The freeze on thresholds \u2013 seen as a form of \u201cstealth tax\u201d \u2013 will mean that by 2027, everyone receiving the new state pension will be charged income tax, according to the Institute for Fiscal Studies (IFS).<\/p>\n

Most income tax and national insurance contribution thresholds were frozen under the previous Conservative government in April 2023, with the freeze currently set to expire in 2028.<\/p>\n

New FeatureIn ShortQuick Stories. Same trusted journalism.<\/p>\n

While Rachel Reeves<\/a> said in last year\u2019s Budget that she had opted against extending the freeze because it would \u201churt working people,\u201d she is widely expected to U-turn on that decision in the Budget, in two weeks\u2019 time, because of the parlous state of the national finances.<\/p>\n

Freezing thresholds<\/a> raises extra tax revenue for the Government because inflation and wage growth push more people into higher tax brackets or over the personal allowance.<\/p>\n

According to new analysis by the IFS, if Reeves were to extend the threshold freeze by another two years to April 2030, it would raise \u00a38.3bn in that year.<\/p>\n

The think-tank said that the freeze had already had an enormous impact on who pays tax and at what rates.<\/p>\n

For example, for the first time ever, the full new state pension is set to rise above the income tax personal allowance threshold in 2027.<\/p>\n

In 2022-23, just under half of those on the full new state pension paid tax on their incomes, but by 2027-28, the figure will be 100 per cent.<\/p>\n

\t\tYour next read<\/p>\n


\n\t\t\t\"Article <\/a><\/p>\n

As well as pensioners, more minimum wage workers are being pulled into income tax by the threshold freeze.<\/p>\n

Discussing freeze on thresholds, a Treasury spokesman said: \u201cWe will deliver a Budget that boosts growth and cuts the cost of living, having already delivered a record rise to the national minimum wage and national living wage, extended the \u00a33 bus fare cap, and expanded free school meals, breakfast clubs and free childcare.<\/p>\n

\u201cThanks to our commitment to the triple lock, 12 million pensioners will get an increase of up to \u00a3470 a year and our efforts to boost pension credit take up mean that over 57,000 extra pensioner households were awarded the benefit, worth on average \u00a34,300 a year.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"The freeze on thresholds will mean that by 2027, everyone receiving the new state pension will be charged…\n","protected":false},"author":2,"featured_media":569610,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3093],"tags":[1194,51,474,22664,2064,617,2499,619,1200,16,15],"class_list":{"0":"post-569609","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-budget","9":"tag-business","10":"tag-finance","11":"tag-income-tax","12":"tag-national-insurance","13":"tag-pensions","14":"tag-personal-finance","15":"tag-rachel-reeves","16":"tag-tax","17":"tag-uk","18":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115547529380663161","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/569609","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=569609"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/569609\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/569610"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=569609"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=569609"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=569609"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}