State Pension to rise by 4.8% next year – and Martin Lewis says the year after many will need to pay tax on it
The State Pension is set to rise by 4.8% from April 2026 under what's known as the 'triple lock' guarantee – though the exact monetary increase you'll get depends on which version of the State Pension you receive. The rise also means many more will start paying tax on their State Pension from April 2027, MoneySavingExpert.com founder Martin Lewis points out.
The Chancellor is expected to announce that 13 million pensioners will see an above inflation rise to the State Pension next April, the Government confirmed in a statement on Sunday 23 November. It adds that this is due to the "Government's commitment to the triple lock". An announcement is expected in the Budget on Wednesday 26 November.
This means the State Pension is set to be uprated by 4.8% – though this is also still subject to Parliamentary approval.
How the triple lock works
Under the triple lock, the State Pension typically goes up each April by the highest of:
-
Average wage growth between May and July (including bonuses) – 4.8% for this year;
-
September's Consumer Prices Index (CPI) inflation measure – 3.8% this year;
-
Or 2.5%.
Since average wage growth is the highest of the three figures this year, the State Pension is expected to rise by the average wage growth figure of 4.8%.
The new State Pension is expected to rise by over £570 a year
One in three (36% of) state pensioners – 4.7 million – get the new State Pension. You'll be on it if you reached State Pension age after April 2016.
Year | Weekly payment (1) | Annual amount (2) |
|---|---|---|
2025/26 (current) | £230.25 | £11,973
|
2026/27 (new – if increased by 4.8%) | £241.30
| £12,547.60
|
Increase | £11.05
| £574.60
|
(1) The weekly amount is usually rounded to the nearest 5p when the rise is applied. (2) This is the weekly amount multiplied by 52.
Technical note: As set out above, the full new State Pension is expected to rise to £241.30 a week from April 2026. This would bring it very close to the current tax-free personal allowance of £12,570 a year, so we asked HM Revenue & Customs (HMRC) to clarify how the annual State Pension amount is worked out for tax purposes.
HMRC told us: "We calculate how much State Pension an individual accrues each year by calculating one week at the old rate of State Pension and 51 weeks at the new rate."
Presuming the 4.8% increase goes ahead as expected, this would result in an annual taxable amount of £12,536.55 for 2026/27 – meaning those who only get the full new State Pension (and have no other income) WON'T pay income tax on it next year.
The calculation can be slightly different if you reached State Pension age before April 2010 – but it's too complex to get into here (see Box 8 in the HMRC self-assessment help notes for more details).
If you haven't yet reached State Pension age, the annual forecast you'll see on Gov.uk is calculated as the weekly amount divided by seven, then multiplied by 365.25 (to account for leap years).
Those on the basic State Pension will see a smaller cash increase
Nearly two thirds (64%) of state pensioners – 8.4 million – get the basic State Pension. You'll be on it if you reached State Pension age before April 2016.
Year | Weekly payment (1) | Annual amount (2) |
|---|---|---|
2025/26 (current) | £176.45 | £9,175.40 |
2025/26 (new – if increased by 4.8%) | £184.90 | £9,614.80
|
Increase | £8.45
| £439.40 |
(1) The weekly amount is usually rounded to the nearest 5p when the rise is applied. (2) This is the weekly amount multiplied by 52.
Martin Lewis: 'Those on the full new State Pension will pay tax on it from April 2027'
MoneySavingExpert.com founder Martin Lewis explained the State Pension uprating news on X in September, when the figure for average wage growth was first announced. At the time, it was 4.7% – but the Office for National Statistics then revised this figure to 4.8%, so we've updated the figures below:
NEWS. The State Pension is set to rise 4.7% [now 4.8%] next April. We know this as it is 'triple locked' – ie, it rises by the higher of 2.5% or inflation or the rise in average earnings. The key figure has just come in for earnings to July and it's likely to be the highest of the three, at 4.7% [now 4.8%].
So based on that, the FULL State Pension (for someone with all the qualifying National Insurance years) is set to rise from...
NEW state pension: £230.25 to £241.05 a week [now £241.30].
OLD state pension (retirees pre-April 2016): £176.45 to £184.75 a week [now £184.90].
This will take someone on the full new State Pension to £12,535 a year [now £12,548], only £35 [now £22] below the frozen personal allowance (amount you can earn tax-free each year).
So as State Pension income is taxable, that means without any question the following year (unless something changes), those on the full new State Pension with no other income will for the first time pay tax on it (as it will rise a minimum 2.5% and personal allowances are frozen).
Can you turn £800 into £5,500 by boosting your State Pension?
The figures above only apply to those who get the full State Pension, which comes from having enough National Insurance (NI) years – usually around 35 (though it varies widely). Many, especially those on lower incomes, don't have their full years, so get a lower pension and therefore their monetary rise will be smaller still.
If you don't get the full amount, there are two main ways you can increase it – claiming free NI credits or buying extra years. The first is a no-brainer if you're eligible, but the other option needs to be considered carefully. For full info, see our step-by-step State pension boosting guide.
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