New calls to stop older people paying income tax on State Pension rejected by UK Government
The UK Government has rejected calls for an end to income tax deductions on the State Pension. More than 19,800 people have signed an online petition created by Ray Crawford who argues that people like himself, are “penalised by the UK Government and HM Revenue and Customs by paying income tax on our State Pension because we have either workplace or private pension schemes to support us in later life”.
In an official response to the proposal, the Treasury said: “Removing income tax from the State Pension would add complexity to the tax system and those paying higher rates of tax would receive the greatest benefit. “Income earned through employment is taxable. In general, benefits that are designed to replace income are taxable and the same applies to income from the State Pension.”Top Money Stories Today The Treasury’s response continued: “It is important to note that the Personal Allowance of £12,570 is currently set at a level high enough to ensure that those pensioners whose sole income is the New State Pension or Basic State Pension do not pay any income tax.
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