"Average Earnings Growth" and triple lock

BlackKnightMonty

MeteredOut said:

BlackKnightMonty said:

Rachel Reeves confirms if you receive the SP only, and it takes you over the personal allowance, you will not have to fill in a self assessment and you will not pay the income tax over the allowance. For the remainder of this parliament.

https://x.com/martinslewis/status/1994166357500346460?s=46&t=wjgj9AHysRwn3YQi4vJFdw

Deep down, I bet you're enjoying the additional bitterness towards pensioners this announcement affords you

I do like the Quadruple Lock name though. You should get a job as a tabloid headline writer.

In truth I have mixed feelings. The schadenfreude for the prospect of state pensioners filling in a self assessment for a quite trivial amount of income tax was quite delicious. But then the savings, of not having to listen to the likely endless moaning from state pensioners about having to do so, is also something to appreciate.

Ultimately it’s more ammunition in terms of pensioner favouritism. The other being cash ISA limited to £12k unless you are 65 or over then it’s £20k. Quite frankly that is age discrimination in my view.

hugheskevi

I do worry this is another well-intentioned measure that will end up being extremely hard to remove.

Just taking the routine case - full new State Pension, standard Personal Allowance, in 2026/27, there should be nothing to write off.

Using OBR assumptions for Triple Lock uprating, the write-off starts at £79 in 2027/28. Then it grows each year:

2028/29: £144

2029/30: £211

2030/31: £279

By the time the current freeze is scheduled to end in April 2031, we are talking about write-offs at the level of Winter Fuel Payments. I think it will be an unwelcome future problem to introduce the beneficiaries of this policy into paying tax due to the cliff-edge now being built up by the write-off.

SnowMan

hugheskevi said:

I do worry this is another well-intentioned measure that will end up being extremely hard to remove.

Just taking the routine case - full new State Pension, standard Personal Allowance, in 2026/27, there should be nothing to write off.

Using OBR assumptions for Triple Lock uprating, the write-off starts at £79 in 2027/28. Then it grows each year:

2028/29: £144

2029/30: £211

2030/31: £279

By the time the current freeze is scheduled to end in April 2031, we are talking about write-offs at the level of Winter Fuel Payments. I think it will be an unwelcome future problem to introduce the beneficiaries of this policy into paying tax due to the cliff-edge now being built up by the write-off.

Absolutely. I said earlier up the thread

Note if the current parliament ends in August 2029 then the April 2027 increase will push the new state pension above the personal allowance and then there will be two further increases in April 2028 and April 2029. So could perhaps be talking about an amount of tax of say £200-£300 per person per year being written off by the end of the parliament, so an extra winter fuel payment for those in this category. 

QrizB

An early election would fix that - "this parliament" could end in ealy 2026

Qyburn

The statement being quoted goes ..

"The government will ease the administrative burden for pensioners whose sole income is the basic or new State Pension without any increments so that they do not have to pay small amounts of tax via Simple Assessment"

They're promising to ease the "administrative burden", not necessarily the tax burden. And pensioners won't have to pay small amounts of tax "via Simple Assessment", that's not the same as saying they won't pay it at all.

Logically if they weren't going to be taxed, there's no "administrative burden" to be eased.

Grumpy_chap

QrizB said:

An early election would fix that - "this parliament" could end in ealy 2026

Whilst there is no indication that the next GE will be as soon as that, it does have to be held by summer 2029.
If the current incumbents consider things to be going well, we might reasonably expect the GE to be summer 2028.
If the current incumbents consider things to be going less well, we might reasonably expect the GE to be summer 2029.

Either way, the cynic might interpret the measures announced in this budget with delayed implementation as laying a series of traps:

• eVED from April 2028
• salary sacrifice changes from April 2029
• SP (only) incomes protected from tax until 2030

Dazed_and_C0nfused

BlackKnightMonty said:

MeteredOut said:

BlackKnightMonty said:

Rachel Reeves confirms if you receive the SP only, and it takes you over the personal allowance, you will not have to fill in a self assessment and you will not pay the income tax over the allowance. For the remainder of this parliament.

https://x.com/martinslewis/status/1994166357500346460?s=46&t=wjgj9AHysRwn3YQi4vJFdw

Deep down, I bet you're enjoying the additional bitterness towards pensioners this announcement affords you

I do like the Quadruple Lock name though. You should get a job as a tabloid headline writer.

In truth I have mixed feelings. The schadenfreude for the prospect of state pensioners filling in a self assessment for a quite trivial amount of income tax was quite delicious. But then the savings, of not having to listen to the likely endless moaning from state pensioners about having to do so, is also something to appreciate.

Ultimately it’s more ammunition in terms of pensioner favouritism. The other being cash ISA limited to £12k unless you are 65 or over then it’s £20k. Quite frankly that is age discrimination in my view.

That was never even an option.  Journalists who can't be bothered finding out the facts may say it but it hasn't been a thing for many years now and none of this changes that.

Dazed_and_C0nfused

hugheskevi said:

I do worry this is another well-intentioned measure that will end up being extremely hard to remove.

Just taking the routine case - full new State Pension, standard Personal Allowance, in 2026/27, there should be nothing to write off.

Using OBR assumptions for Triple Lock uprating, the write-off starts at £79 in 2027/28. Then it grows each year:

2028/29: £144

2029/30: £211

2030/31: £279

By the time the current freeze is scheduled to end in April 2031, we are talking about write-offs at the level of Winter Fuel Payments. I think it will be an unwelcome future problem to introduce the beneficiaries of this policy into paying tax due to the cliff-edge now being built up by the write-off.

Unless your Personal Allowance is only £11,310.

Presumably there will need to be some thought given to Marriage Allowance but at the moment there is nothing to prevent an application being made and someone receiving the standard new State Pension making themself liable to tax.

Dazed_and_C0nfused

Qyburn said:

The statement being quoted goes ..

"The government will ease the administrative burden for pensioners whose sole income is the basic or new State Pension without any increments so that they do not have to pay small amounts of tax via Simple Assessment"

They're promising to ease the "administrative burden", not necessarily the tax burden. And pensioners won't have to pay small amounts of tax "via Simple Assessment", that's not the same as saying they won't pay it at all.

Logically if they weren't going to be taxed, there's no "administrative burden" to be eased.

Although RR has now said to Martin Lewis that they would not need to pay any tax, which is clearly different to Wednesday's announcement.

FIREDreamer

QrizB said:

An early election would fix that - "this parliament" could end in ealy 2026

I do hope so. However my hopes aren’t high.