• Contact
Financial Planning Today
  • Home
    • About Us
      • About us
      • Advertising
  • News
    • Financial Planning News
    • Regulation
    • Professional Bodies
    • Wealth Management
    • Job News
    • Paraplanning
    • M&A News
  • Opinion
    • The Editor's Column
    • Mr Sipp - John Moret
    • Life Planning Founder George Kinder
    • Guest Columnist
  • Features
    • Training and Events
    • Insight & Analysis
  • FP Today Magazine
  • Optimum
  • Jobs
  • Home
    • About Us
      • About us
      • Advertising
  • News
    • Financial Planning News
    • Regulation
    • Professional Bodies
    • Wealth Management
    • Job News
    • Paraplanning
    • M&A News
  • Opinion
    • The Editor's Column
    • Mr Sipp - John Moret
    • Life Planning Founder George Kinder
    • Guest Columnist
  • Features
    • Training and Events
    • Insight & Analysis
  • FP Today Magazine
  • Optimum
  • Jobs
  • Cuts to salary sacrifice ‘on agenda’ warns Webb

    There could be changes to salary sacrifice for workplace pensions, former pensions minister Sir Steve Webb has warned after HMRC today published new research around ‘hypothetical’ cuts to salary sacrifice.

  • Pensioners paying higher rate tax doubles to 1m

    The number of pensioners paying higher rate tax at 40% or 45% has doubled to a million in the last four years.


    Four years ago only half a million pensioners paid higher rate taxes.

    Nearly 9m pensioners now pay income tax.

    In a little-noticed knock-on effect of fiscal drag, these pensioners will also pay extra tax on their savings income and capital gains, according to former Pension Minister Steve Webb.

    He warned: “The higher rate threshold has become a real cliff-edge over which growing numbers of pensioners are falling.”

    The LCP partner, a former Pensions Minister, obtained the figures from HMRC through an Freedom Of Information request.

    Sir Steve said: “There has been a significant increase in the number of pensioners paying income tax at all rates, but the rise has been greatest in the numbers paying income tax at the higher rates.”

    He said: “Not only does this mean more tax on things like income from state and company pensions, it also means these pensioners are paying more tax on their savings, as their personal savings allowance is cut, and a higher rate of capital gains tax – a ‘triple whammy’.”

     

    The key figures revealed by the FOI request are:

    • The total number of pensioners paying income tax at all has risen by around 2m in four years, from 6.7m in 2021/22 to 8.8m in 2025/26, an increase of nearly a third;
    • However, the total number of pensioners paying at 40% or above has doubled over the period; in 2021/22 the figure was just under half a million (494,000) but this year it has risen above the one million mark (1,028,000);
    • The proportion of taxpaying pensioners who pay at 40% or more has climbed from around 1 in 14 in 2021/22 to around 1 in 9 this year;

    The main reasons for the increase, according to Sir Steve, are:

    • The continued freeze in the income tax personal allowance and higher rate threshold
    • Significant above-inflation increases in the rate of the state pension combined with other inflation-linked pension increases

    Mr Webb warned: “What is not commonly noted is that being a higher rate taxpayer – even by just £1 – triggers higher rates of tax on other forms of income.”


  • Industry urged to probe pensioner spending habits

    Pension providers have been urged to find out more about post-retirement spending as new research suggests homeowners’ and renters’ drawdown habits are very different.

  • Mortgage lending past pension age 'now entrenched'  

    New data on mortgage lending from the Bank of England has revealed that lending into retirement has remained at a high level despite falling mortgage rates. 

  • Ex-minister warns of pensions ‘nightmare’ for grieving families

     

    A former Pensions Minister and retirement expert has attacked the government’s Budget day decision to include pensions and pension death benefits within estates for inheritance tax (IHT) purposes.

  • Pension tax relief could be targeted by Chancellor

    Chancellor Rachel Reeves is likely to take a close look at pension tax relief as she looks at ways to raise money for the Treasury in her first Budget next month, consultants LCP have warned.

  • Urgent need for better at-retirement support

    There's an urgent need for better at-retirement support, according to former pensions minister Steve Webb, who has called on the FCA to speed up its advice/guidance review.

  • State Pension increase to pull 340,000 into paying income tax

    An estimated 340,000 more pensioners will pay income tax on their State Pension next year due to the Triple Lock pushing up the State Pension above inflation.

  • DWP website

    Over half a million new people saving in a pension by Christmas says DWP

  • Auto-enrolment reform by DWP

    Pensions auto-enrolment begins today for largest firms

  • Aberdeen Asset Management

    Aberdeen Asset Management publishes research into workplace pensions

  • Tony Solway, chairman of TISA

    TISA Conference taking place in the City today

  • Steve Webb MP.

    TISA conference: Steve Webb confirms 'pot follows member' approach

  • Houses of Parliament.

    Firms respond to plans for new flat-rate State Pension

  • Big Ben.

    Committee calls for better publicity regarding State Pension changes

  • FCA consumer panel chairman Adam Phillips

    Opinions divided over consultancy charging ban

  • Houses of Parliament.

    Pensions Bill gets second reading in House of Commons

  • Pensions Minister Steve Webb

    Hargreaves Lansdown backs DWP on pension charge cap

  • Pensions Minister Steve Webb

    Pensions Minister set to address CBI conference

  • Pensions Minister Steve Webb

    Auto-enrolment cap charge delayed

Page 1 of 7

  • Prev
  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • Next

Key Links

  • Privacy Policy
  • Terms and Conditions
  • Contact us
  • Advertise
  • About
  • Sitemap
  • Contact the Newsdesk
Copyright © 2025 Financial Planning Today. All Rights Reserved.