Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps her Department is planning to take to reduce taxes on pensioners.

The Government wishes to encourage pension saving to help ensure that people have funds to draw on throughout retirement.  That is why, for the majority of savers, pension contributions made from income during working life are tax-free. This makes pensions tax relief one of the most expensive reliefs in the personal tax system, costing £78.2 billion in 2023/24.

The State Pension is the foundation of the support available to pensioners. Over the course of this Parliament, the yearly amount of the full new State Pension is currently projected to go up by around £2,100. This year the headline rate of the new and basic State Pension will remain below the income tax personal allowance. Furthermore, the Chancellor has said that we will ease the administrative burden for pensioners paying small amounts of tax via simple assessment.

More broadly the Government has established a Pensions Commission to consider the long-term future of the pensions system and ensure it remains strong, fair and sustainable for future generations.