Hundreds of thousands of pensioners will have to start setting aside some of their state pension for unexpected tax bills, a former UK government minister has claimed.
A combination of big increases in the state pension – with a rise of 8.5% scheduled for next spring – and a continued freeze in income tax thresholds means growing numbers of older people will be dragged into the tax net “purely on the basis of their state pension”, says the ex-pensions minister Steve Webb.
