State pension and working

davez_2

Hi, im due my state pension in mid December. Which i have just got the letter to apply for. Due to work i want to keep working until Jan 31st. I assume i will pay tax on my pension until that time. Do i have to tell anyone im working until Jan or will this be picked up by the relevant agencies? And when i finally leave work do i have to inform anyone? Sorry this all new to me

Albermarle

Although the state pension is taxable, it is never taxed directly. Any tax due will be taken from other taxable income you have .
For example if you earn £30K and you have the normal tax free allowance of £12570 . This tax free allowance will be reduced by the amount of state pension, so you will pay more tax on your employment earnings.
This should happen automatically but not instantaneously. Once you stop work, you will not pay any tax as the state pension is below the personal allowance, unless you have other income of course.
In any case if you pay a bit too much or not enough tax , it will all come out in the wash later in 2023, when HMRC do your calculation for 22/23.

MX5huggy

In better news you will stop paying NI once you reach state pension age. 

What’s your pension situation once you retire? Hope it’s not just SP. But you could look at delaying SP https://www.gov.uk/deferring-state-pension/what-you-get

davez_2

As im only working about one month extra im sure it will work out not to much in tax.. At least i will hopefully have my state pension sorted before leaving work, which is my main worry as i need to keep some cash flow.. Sadly im one of the lower earners so SP will be my only income, fear not i have bever been a great spender. Im sure i will survive. Im sure i will find out soon enough.

xylophone

Sadly im one of the lower earners so SP will be my only income, f

No workplace pension?

JoeCrystal

davez_2 said:

As im only working about one month extra im sure it will work out not to much in tax.. At least i will hopefully have my state pension sorted before leaving work, which is my main worry as i need to keep some cash flow.. Sadly im one of the lower earners so SP will be my only income, fear not i have bever been a great spender. Im sure i will survive. Im sure i will find out soon enough.

If you do work for an employer, did they not automatically enrol you into the pension scheme or have you always been self-employed?

RobM99

Albermarle said:

Although the state pension is taxable, it is never taxed directly. Any tax due will be taken from other taxable income you have .

Corrext, my tax code went down to accommodate this.

luvchocolate

When you claim your state pension you can request it to be paid weekly. 
They do not offer it you need to ask 

calcotti

davez_2 said:

… so SP will be my only income, ..

You should be able to claim Council Tax Reduction to help with your Council Tax and, if you rent, Housing Benefit (unless you have a partner in which case your joint circumstances will be considered and if your partner is working age would have to claim Universal Credit).

davez_2

Thanks for the replies all taken on board.  Luckily just myself to think about.


xylophone said:

Sadly im one of the lower earners so SP will be my only income, f

No workplace pension?

Nothing to write home about and i cashed in what i had earlier last year, just a small amount

xylophone

You know how much you can expect from your state pension?