Higher tax free allowances for pensioners

hansi

With regard to Mr Brown's Budget announcement re the above, could someone clarify who is classed as a "pensioner"? Ok, I know that it's at age 65 but my wife who is now 62 has been receiving a full state pension since she turned 60 having paid a full stamp all her working life. Will she qualify for these new allowances? Or will she have to wait till 65? If so, isn't a bit of a con?

jem16

The extra personal allowances start from age 65.

They also don't start until April 2009.

dunstonh

Mr Brown was using a bit of a soundbite. The allowance is known as age allowance and there is no mention of pensioner in the allowance.

They have been round donkey's years so its nothing new. The only difference is the increase but then they get increased in every budget anyway.

exil

True, but in 2008 they will be going up by £1180 over the "indexation" increase. That will more or less cancel out the effect of the 10% tax band disappearing for most pensioners. The timing is suspicious though - the "give" will happen in 2008 and the "take" in 2009. Election in 2008?

The 10% tax band stays for savings income, which would I suspect also help most pensioners - though I admit to being hazy on how this will work in practice - will we all have to fill in tax returns to have our savings income taxed at 10% rather than 20%? And will we only be able to do this if our TOTAL income is less than (personal allowance + 2000-ish)?