𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

The Treasury has given a response to a massive call for pensioners to have their personal tax allowance doubled in a key House of Commons showdown. A debate took place yesterday evening at Westminster Hall after a huge petition was signed up by 120,000 people calling for a reform that would double the UK state pension tax threshold from its current level of £12,570 to £25,140.

Chancellor Rachel Reeves’ Treasury gave a key response to the plan – and it was bad news for those hoping for change. The Government has officially ruled out doubling the personal tax allowance for state pensioners, following a Westminster Hall debate sparked by an e-petition with over 120,000 signatures

During the debate on June 15, 2026, cross-party MPs raised concerns that rising state pensions, protected by the triple lock, combined with frozen personal tax thresholds, are dragging thousands of older people into paying income tax. Conservative MP John Lamont, who opened the debate, highlighted that dealing with unexpected tax bills from HM Revenue and Customs or being forced to complete self-assessment forms can be “both distressing and deeply worrying for those hard-pressed pensioners”

The petition, created by Tim Mason, was brought forward because many pensioners who worked hard and saved throughout their lives are finding their relatively small private or occupational pensions being heavily taxed once they begin receiving the state pension

Tory Mr Lamont said: “There are growing concerns that increasing numbers of pensioners are finding themselves liable to pay tax on their pensions. That is because the triple lock has increased the state pension year on year, while personal tax allowances have remained frozen. As a result, some pensioners are required to complete a self-assessment tax return, while others receive unexpected tax bills from HM Revenue and Customs.

“Many pensioners do not have substantial incomes and have limited savings; it can therefore be both distressing and deeply worrying for those hard-pressed pensioners to deal with tax demands. As the organisation Silver Voices has highlighted, taxing the state pension risks undermining the very principle of a retirement safety net, which was designed to ensure that people can afford life’s basic necessities in retirement.”

Conservative MP Mark Garnier directly challenged the Government on the petition’s core aim, asking if the Minister was willing to raise the tax-free threshold for pensioners to £25,140—effectively maintaining it at 200% of a working person’s allowance. Talking about the Chancellor, he said: “After promising not to extend the freeze—something we would have supported —she went back on her word and chose not to protect hard-working people.

“That matters to pensioners, because the state pension will soon rise above the income tax threshold due to the triple lock, which we all agree is a good thing to remedy the ills that happened when the Toggle showing location ofColumn 265WHstate pension fell to, I think, about 13% or 14% of average earnings. That means that pensioners will now have to start paying income tax.

“The Government have proposed that basic-rate state pensioners will not have to fill in a tax return, although this seems to be a specific sort of form-filling break for the over-67s rather than an actual hiking of the allowance. “

“I look forward to hearing from the Minister whether he is willing to raise the tax-free threshold, as identified in this petition, from £12,500 or thereabouts to £25,140, and will then maintain it at 200% of the working person’s tax-free threshold.”

Liberal Democrat MP Charlie Maynard also attacked the frozen thresholds, describing them as a “stealth tax grab” that pulls pensioners and low-income earners into paying more tax. Raising tax thresholds is the best and fairest way to cut taxes. Liberal Democrats would advocate that as a way to reduce income tax for everyone at every stage of life, taking the lowest-paid, including state pensioners, out of income tax altogether when public finances allow. When we were in government, we raised the personal allowance, taking millions of people out of income tax, putting money back into people’s pockets and helping ensure that work and hard-earned state pensions would pay.

“By contrast, the Conservatives and Labour have frozen it again and again. That has left us in a position in which the state pension is nearly equal to the threshold. The full rate of the new state pension for 2026-27 is £240.30 a week, or £12,547.60 a year, while the standard personal allowance is £12,570 a year. It is an absolutely tiny gap.”

Pensions Minister Torsten Bell delivered a clear rejection to campaigners, stating unequivocally that “no political party will deliver a doubling of the personal allowance for pensioners”. He explained that such a drastic increase would come at a fiscal cost of “several billion pounds each year,” which he argued is inconsistent with the Government’s two main priorities: raising the basic state pension and rescuing the NHS

Mr Bell defended the Government’s position by noting that the tax system has always treated pensions as taxable income, pointing out that over 80% of pensioners were already paying income tax by the end of the previous Conservative administration. He added that extending the freeze on the personal allowance was a necessary choice to put public finances on a sustainable footing, stressing that the UK’s tax system remains progressive and “those who have more contribute more”

He said: “The yearly amount of the full new state pension is projected to rise by about £2,100 over this Parliament, reflecting our manifesto commitment to uprate via the triple lock throughout this Parliament.”

While the £25,140 threshold was dismissed, Bell did confirm some upcoming administrative relief for older taxpayers. He announced that the forthcoming Finance Bill will include specific measures to ease the administrative burden on pensioners, ensuring they will not have to deal with the “simple assessment” process to pay small amounts of tax from 2027-28

“Members will know that the basic and the new state pensions increased by 4.8% in April; I think it is a matter of cross-party consensus that that is a good thing. It will boost pensioner incomes by up to £575 a year. We are also protecting the poorest pensioners with a 4.8% increase in the pension credit minimum guarantee.”

Despite the rejection of the petition’s main goal, MPs across the house concurred on the underlying sentiment of the debate: that pensioners who have worked hard and contributed to society “deserve dignity, security and peace of mind in retirement”.

To watch the debate in full, click here.