What’s the difference between state pension and pension credit and are they linked?

[Gray]

This is not the case, it has been made clear that when the state pension goes over the income tax threshold, it will be exempt from income tax. This was mentioned on BBC's Morning Live, today.

Has it been made clear?
I think that will be news to a lot of people.
(I don't miss much news, though I'm fortunate never to be up early enough to watch breakfast TV).
One way or another, there will be much discussion about it, before people ONLY on state pension actually need to pay tax.

 

[Angle Poise-Lamp]

Has it been made clear?
I think that will be news to a lot of people.
(I don't miss much news, though I'm fortunate never to be up early enough to watch breakfast TV).
One way or another, there will be much discussion about it, before people ONLY on state pension actually need to pay tax.

Right, with a little more research, it's clear that it's not so simple as was said on the telly this morning so, this from the FT:
"Pensioners will have their income tax liabilities written off if their sole income comes from the state pension.

As part of chancellor Rachel Reeves’ plans to modernise the tax system, pensioners who rely solely on the state pension for income will not have to pay income tax even if it exceeds the personal allowance.

The plan which will come into effect from 2027-28, aims to “ease the administrative burden” for pensioners, by not making them pay “small amounts of tax” via simple assessment."

Nothing is ever bloody straightforward...

 

[Gray]

pensioners who rely solely on the state pension for income will not have to pay income tax even if it exceeds the personal allowance.

It's good that tax returns won't (may not) be involved.
But, as things stand, I don't think the above is true.
They may not get a bill, but (surely) the amount above the allowance will be taxed at source - so they'll still effectively be paying the tax 🤔

Expect to hear more from Martin Lewis tonight (on the only ITV programme I ever watch).

 

[GSV Ethics Gradient]

They may not get a bill, but (surely) the amount above the allowance will be taxed at source

At the moment the state pension is never taxed at source, even if it exceeds allowances - which is possible because of inherited spouse's pension, and in some cases combinations of graduated pension, SERPS and/or S2P.

 

[Gray]

At the moment the state pension is never taxed at source, even if it exceeds allowances

Indeed, but that's what will need to change, for many, within a couple of years - and I think that 'simple assessment' scheme is how it will be done.
No tax return hassle, thanks very much.

 

[Gray]

Expect to hear more from Martin Lewis tonight (on the only ITV programme I ever watch).

Predictably, it was soon covered:
For those ONLY on state pension, not only no tax return necessary, but no tax to pay on anything above the allowance "for the life of this parliament".

...and that last bit is the surprise - because all those on the 'new', full SP will be above the allowance before the date that the current parliament is due to end.

EDIT: next day, further confirmation:
BBC News - State pensioners with no other income will not have to pay tax - BBC News

State pensioners with no other income will not have to pay tax

The chancellor says those who only receive the state pension won't have to pay income tax before 2030.

www.bbc.co.uk

 

[Dave_]

If only I could've done.
Needed a 'gateway'...or some other name.
In order to access the gateway, a third party company had to confirm my I.D.
They couldn't.

I don't recall doing that, but I've had a govt gateway login for over 20 years for dealing with HMRC online.

In my case it was MUCH quicker, easier and cheaper to phone the freephone number and speak to a helpful person - very much less faff.

Glad it worked for you, personally I avoid phone calls and the royal mail at all costs....