One in five pensioners – an estimated 2.5 million – pay income tax on their state pension and will continue to do so regardless of who wins the election.
The Conservative manifesto includes a ‘triple lock plus’ proposal which is supposed to protect people on the state pension from paying income tax.
The standard full new state pension is worth £11,541.90 a year, which is currently below the standard personal allowance of £12,570 the point for when most people would start to pay tax.
However, a significant number of people – 2.5m – receive a state pension of more than £12,570 which means they are already paying tax.
The figures come from pension consultant LCP (Lane Clark & Peacock) shows that there is huge diversity in the amount of state pension people receive.
Partner at LCP and former Liberal-Democratpensions minister in the coalition government, Sir Steve Webb, said: “Much of the discussion has …