The UK state pension will increase by 3.9% from 6th April 2027, taking the flat-rate state pension to £250.70 per week (up from the previous £241.30 per week). This equates to £13,036 per year or around £1,086 per month (although state pension is normally paid on a 4-weekly basis).
The increase was confirmed in the Autumn Budget, delivered on 28th October by the new Chancellor, John Healey. The Government has committed to maintaining the “triple lock” until the end of the current Parliament. This means that the increase was again determined by the figure for average annual wage growth (for May to July 2026) of 3.9%, higher than both the September 2026 inflation figure of 3.5% and the minimum increase level of 2.5%.
However, the Government has announced its intention to modify the triple lock from April 2030, maintaining the minimum increase of 2.5% or the previous September’s inflation figure, but replacing annual wage growth with a link to average wage growth over time. This is intended to ensure that the state pension no longer grows faster than wages.
It was also announced in the Budget that a new “Pension Tax Allowance” will apply from April 2027, so pensioners whose income is up to the value of the full state pension do not have to pay small amounts of tax. The personal allowance has remained frozen at £12,570 for the new 2027/28 tax year, but the Pension Tax Allowance (PTA) increases this to £13,037 for those in receipt of the state pension. The PTA is withdrawn at a rate of £1 for every £3 of income above this threshold, meaning those with income above £13,319 will not benefit from it.
State pension age has now increased to 67 (unless you were born before 5 March 1961). There is a further rise to age 68 currently scheduled between 2044 and 2046, although it is possible this increase may be brought in sooner.
You can check your state pension forecast online at https://www.gov.uk/check-state-pension (please note this link will take you to a UK Government website and I am not responsible for its content) or complete and post the BR19 request form.
You do have to claim your state pension as it will not be paid automatically. It is paid gross but is taxable, so your tax code is likely to change for any other sources of income.
Tax treatment depends on individual circumstances and may change in the future.
The information contained in this article is for general information purposes only and does not constitute personal financial advice. Individual circumstances will vary and professional advice should be sought before taking any action.
If you do have any queries or concerns, please call or drop me an e-mail.