Millions on the state pension face a fresh shake-up next spring, with pay packets and tax bills set to shift again.
The annual uprating mechanism has done its work and confirmed a significant uplift for retirees. The guaranteed rise protects incomes, yet it nudges many closer to the income tax line after years of frozen thresholds.
What has been confirmed
The state pension will increase by 4.7% from April 2026 under the triple lock, which links the yearly rise to the highest of inflation, average earnings growth, or 2.5%. With wages up 4.7%, that figure sets the pace for 2026/27.
The full new state pension will rise to £12,535 a year (about £241 a week), up by £562 from April 2026.
This change affects everyone receiving the state pension, though the exact amount depends on whether you’re on the full new state pension or the older basic state pension and on your National Insurance record.
How much you’ll get in practice
For those on the full new state pension, the confirmed figures mean more money in every payment cycle. The Department for Work and Pensions usually pays the state pension every four weeks.
| Period | Weekly | Four-weekly | Annual | Change |
|---|---|---|---|---|
| 2025/26 (current) | ~£230.25 | ~£921.00 | £11,973 | – |
| 2026/27 (from April 2026) | ~£241.05 | ~£964.20 | £12,535 | +£562 |
Figures are rounded for clarity. Your entitlements may differ if you have gaps in your National Insurance record or if you reached state pension age before April 2016 (when the basic state pension rules apply).
Why a pay rise can still pinch
The headline increase looks generous, yet it sits just under the income tax personal allowance of £12,570. That gap is slim. A small amount of other taxable income — from a modest workplace pension, part-time earnings or certain benefits — can tip you into paying tax for the first time.
With the new state pension at £12,535, as little as £35 of extra taxable income could trigger an income tax bill if the personal allowance remains unchanged.
That effect is known as fiscal drag: incomes creep up while tax thresholds stay put, pulling more people into the tax net without a rate rise. It won’t affect everyone equally, but many pensioners with even modest extra income will notice the shift.
A quick tax example
Consider a retiree on the full new state pension plus a small personal pension of £1,200 a year. Their taxable income would exceed the personal allowance by about £1,165. At the 20% basic rate, that’s roughly £233 of tax over the year. The exact outcome depends on your tax code and any other allowances you can claim.
Triple lock explained
The triple lock pegs the annual increase to the strongest of three measures: inflation (CPI), average earnings growth, or 2.5%. In 2026/27, average earnings growth of 4.7% is the largest figure, so it sets the rise.
The triple lock guarantees a rise every year, protecting spending power over time — but the cost to the public purse grows as pensions climb.
Ministers have pledged to keep the triple lock for the rest of this Parliament. After that, future policy remains a political choice and could be revisited by the government of the day.
Who gains and who risks paying more
- Retirees on the full new state pension will see the biggest cash increase: £562 per year.
- Those on the basic state pension will also receive a 4.7% rise, though the cash amount depends on their NI record and any additional state pension.
- Pensioners with private or workplace pensions, or with part-time earnings, face a higher chance of falling into the tax net due to the frozen personal allowance.
- Households close to the threshold could see small changes in savings interest or side income tip them into tax.
What to check now
You can take a few practical steps to prepare before April 2026. These won’t change the triple lock decision, but they can help you keep more of the uplift in your pocket.
Make your allowances work
- Check your tax code: make sure HMRC is using the correct figures for your pensions and any employment income.
- Marriage allowance: if one spouse has spare personal allowance and the other is a basic-rate payer, a transfer could reduce the household tax bill.
- Use ISAs for savings: interest earned in ISAs is tax-free and won’t push you over the tax line.
- Time withdrawals: if you draw from a private pension flexibly, consider the tax year timing to keep income near thresholds.
- Monitor small extras: even modest earnings or benefit top-ups can change your tax position when the gap to the allowance is so narrow.
Key dates and how payments land
The new rates take effect from April 2026, with increases typically applied from your first payment date after the change. Most state pension payments arrive every four weeks, although some legacy arrangements differ. Bank holidays can shift the landing day, but the amount remains the same.
Beyond the headline figure
The £562 uplift will help with everyday costs that still feel higher than before the inflation spike. Energy, food and council tax remain elevated compared with pre-pandemic norms. A predictable, guaranteed rise helps planning, particularly for those relying on the state pension as their main income.
That said, the tight gap to the personal allowance means many people will see a little of the increase clawed back through PAYE on their private pension or via self-assessment. The effect varies widely: a person with no other taxable income may stay outside tax, while a neighbour with a small second pension could pay basic-rate tax on part of theirs.
If you’re not on the full amount
Not everyone gets the full new state pension. Gaps in National Insurance records, periods of contracting out, or a mix of pre- and post-2016 entitlements can all reduce the figure. You can sometimes improve your record by paying voluntary NI contributions, subject to deadlines and value for money. Running the numbers before paying is sensible, as the break-even point depends on your health, the size of the gap, and how long you expect to claim.
A quick sense-check for your household
Try a simple exercise to see how the new rate affects you next year. Add up your expected 2026/27 income:
- State pension (use £12,535 if you’re on the full new rate)
- Any workplace or private pensions (gross amounts)
- Part-time earnings and taxable benefits
- Taxable savings interest and dividends, after considering relevant allowances
Compare the total with the personal allowance of £12,570. If you sit above it, expect some tax at 20% on the excess, unless other allowances apply. If you fall just below, keep an eye on changes to interest rates or extra income that could tip you over during the year.
Bottom line: a 4.7% rise delivers a real cash gain, but frozen thresholds mean more pensioners edge into tax.
If you’re on a lower income, check whether you qualify for help such as Pension Credit or Council Tax Support. Eligibility can unlock extra payments and cost-of-living help. Claiming the right support often matters more to your budget than the annual uplift alone.
Quick clarification: the article says the 4.7% rise applies from April 2026, but the headline reads “next April.” Are we talking 2026/27 figures (£12,535) or 2025/26? Also, if the personal allowance stays frozen at £12,570, will HMRC adjust codes automatically for small private pensions, or should we expect under/overpayments until the P800 catches up?