Chancellor John Healey created a Pension Tax Allowance on October 28, 2026.
Around 500,000 pensioners benefit in the 2027-28 tax year.
The full new state pension rises by £489 a year from April 2027.
The pension sits £466 above the £12,570 personal allowance.
Pensioners with income up to the full pension pay no income tax on it.
The full allowance is worth up to £94 in the first year.
Around 290,000 pensioners will pay no tax at all under the plan.
The allowance falls by £1 for every £3 of income above the pension.
Steve Webb warns 200,000 pensioners face a 53% effective tax rate.
The old state pension rises to £192.10 a week from April.
The allowance runs for three tax years, through 2029-30.
Tap to read who gains, who still pays, and what happens next.
Get the full breakdown, key numbers, and what happens next.
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