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Working Pensioners Pay £8.6bn In Income Tax

People who continue to work past their state pension age are paying the highest amount of income tax in 20 years, according to a report.

Research from Aegon found that pensioner households, which contain at least 1 person still in work, are on course to pay £8.6 billion in income tax in 2018/19.

The amount reflects a 5% increase in the number of people working past their state pension age, as the percentage climbed from 12% in 1997/98 to 17% in 2018/19.

Over the same 20-year period, average weekly wages in pensioner households increased 30%, from £410 in 1997/98 to £534 in 2018/19.

Aegon estimates there are around 12.8 million people living in 8.7 million pensioner households in the UK, with around 1.4 million homes containing a working pensioner.

Steven Cameron, pensions director at Aegon, said:

“Gone are the days when reaching state pension age meant a total end to work.

“Many people are choosing to keep working and earning, perhaps by cutting back gradually on the amount of work they do, even once they’ve started taking their pension.

“These people are contributing significant amounts to the nation’s finances through the tax they generate while also helping the broader economy through their work.”

For any help or advice with financial planning talk to RPD

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