Over 65 tax allowance

I know that the tax allowance changes for over 65s, but can anyone tell me if it applies from your 65th birthday or from the start of the first tax year after your birthday?

Also do you need to notify them or is the adjustment made automatically?

I nearly got in trouble because I didn't realise that you had to notify the tax people that you were taking your State Pension. Silly me assumed that as everything was linked by your NI number they would know - apparently the different departments don't talk to each other.
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Comments

  • margaretclare
    margaretclare Posts: 10,789 Forumite
    It applies for the year in which you become 65. At present there's another one for the year in which you become 75. These may alter with the new govt.

    DH and I didn't have to notify HMRC - they were on to it.
    [FONT=Times New Roman, serif]Æ[/FONT]r ic wisdom funde, [FONT=Times New Roman, serif]æ[/FONT]r wear[FONT=Times New Roman, serif]ð[/FONT] ic eald.
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  • scoobs02
    scoobs02 Posts: 85 Forumite
    HMRC and DWP do talk to each other. DWP informs HMRC when your State Pension is due to start and how much you will receive. You should receive form P161 from HMRC either just before or after you turn 65. The additional Personal Allowance is not given automatically in every case. If form P161 isnt returned, they dont give the extra allowance.

    Ex HMRC - dealing with PAYE/SA
  • moonrakerz
    moonrakerz Posts: 8,650
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    The official line is that you have to claim the increased allowance - I would certainly suggest playing safe and doing that !
  • Ches
    Ches Posts: 1,120 Forumite
    I didn't even know about the extra tax allowance until I received a nice tax refund in with my private pension. I phoned to see if it was really mine and if it was ok to spend it and thats when it was explained to me. My birthday is in February and it was backdated from the start of that tax year.
    Mortgage and Debt free but need to increase savings pot. :think:
  • Craftyscholar
    Craftyscholar Posts: 3,403 Forumite
    Many thanks to you all for taking the time to reply.
    I will be keeping a beady eye on what happens when my birthday comes.
  • Jennifer_Jane
    Jennifer_Jane Posts: 3,237
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    scoobs02 wrote: »
    HMRC and DWP do talk to each other. DWP informs HMRC when your State Pension is due to start and how much you will receive. You should receive form P161 from HMRC either just before or after you turn 65. The additional Personal Allowance is not given automatically in every case. If form P161 isnt returned, they dont give the extra allowance.

    Ex HMRC - dealing with PAYE/SA

    Hi scoobs - according to the HMRC website the over-65 allowance starts from the tax year in which you are 65. Ie I am on State Pension, and will be 64 in Jan 2011. I understood that this means that from April 6, 2011 I fall into the over-65 personal allowance as I am 65 in that tax year.

    My question is, however, do I need to contact HMRC before 6th April 2011 to let them know? If not, when will they send me the form that advises the new tax code, please?

    Thanks so much for your help.
  • Newly_retired
    Newly_retired Posts: 2,945
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    I will be 65 in December. In April when I got my notice of coding for this tax year, there was no mention of the higher allowance, so I rang and asked. I was sent form p161 to fill in. The higher allowance can be given from the beginning of the tax year in which the birthday falls. I doesn't happen automatically, you have to tell them. If it is not sorted out from April, then they will adjust your code later ( I'm still waiting for that bit). They told me that if I hadn't rung, they would have sent me this form shortly before my birthday and the code would be adjusted to take account of any over/underpayments.
  • stilernin
    stilernin Posts: 1,217 Forumite
    Am I right in thinking that the over 65s are the only taxpayers not to receive the extra £1000 allowance in Apr? If so, it doesn't seem to fit with all we are hearing about fairness and looking after the elderly etc.

    Also, whilst looking into pensions etc, (my State Pension kicks in in Sept '12 when I'm 61y 2mths) it appears that both women and men get the £9k+ personal allowance at 65; meaning women have been in reciept of the State Pension for 5yrs before getting the higher allowance. Is this another inequality between the sexes when both might keep a part time job when starting on the State Pension?
  • patanne
    patanne Posts: 1,286 Forumite
    It is my belief that the over 65 code will stay as it is until the currently 647 code catches up & both will only apply to lower incomes as the current over 65s code does now. Regarding the age at which we (women that is) get our pensions, we have known about this for the best part of 20 yrs. But, a thought for women who can't get their state pension until, say their 62nd birthday. They can defer their pension for 3 years increase their pension by 30% and retire at 65 along with their male counterparts and proceed to get 30% more pension than them. So maybe we shouldn't complain TOO loudly in case someone decides that is unfair. Instead lets gripe about our graduated pension! Now there we actually ARE coming off worse. Unless they've changed it since I last looked we only get 1 in 9 not 1 in 7. As I am in a better position than most lower earning men I don't think I'll be complaining too loudly about that
  • KeithP
    KeithP Posts: 37,430
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    stilernin wrote: »
    Also, whilst looking into pensions etc, (my State Pension kicks in in Sept '12 when I'm 61y 2mths) it appears that both women and men get the £9k+ personal allowance at 65; meaning women have been in reciept of the State Pension for 5yrs before getting the higher allowance. Is this another inequality between the sexes when both might keep a part time job when starting on the State Pension?
    Yes of course it is an inequality.

    One way of removing that inequality would be to tell you that you cannot have you State Pension until you are 65. Would you then be complaining that they've taken away five years worth of your pension?

    Clearly, phasing in the changes over a period of time is the right thing to do. But until the changes are complete, there will always be some inequality, won't there?
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