ANNOUNCEMENT : ALL OF ROYAL MAIL'S EMPLOYMENT POLICIES (AGREEMENTS) AT A GLANCE (Updated 2021)... HERE

ANNOUNCEMENT : PLEASE BE AWARE WE ARE NOT ON FACEBOOK AT ALL!

Freezing of tax allowances from 2022 to 2026

Royal Mail pension news and discussion.Please note the advise given in this forum is unofficial, please use the links we have for a more detailed response or see an independent financial adviser.
stephen500
EX ROYAL MAIL
Posts: 1458
Joined: 02 Jun 2007, 04:04

Freezing of tax allowances from 2022 to 2026

Post by stephen500 »

So the chancellor has just announced a freeze on tax allowances after this coming new tax year year 2021-22, coming in for 2022-23 till 2026.
Personally for me, my current pension is £11840 and my tax allowance is (in the coming year) £12570.
So unless my RMSPS and RMPP pensions increase by more than £730 through inflation rises till 2026, I should not have to pay any income tax.
If it does I may have to pay an little tax.
I estimate that if my pensions were to rise by 2% a year for those 4 years, my tax liability would be £202 in 2025-26, with £40 annual income tax at a 20% rate in the final year of freezing thresholds.
Personally I can't see our pensions increasing by 2% a year.