Britain's full state pension is on course to pass the tax-free allowance next April. Only pensioners with no other income have been promised no tax.

The stories

10 on this beat today.

Every story told the same way: what happened, who is involved, why it matters, how it works, the truth and the good news.

1. 01

   Britain's full state pension is on course to pass the tax-free allowance next April. Only pensioners with no other income have been promised no tax.

   13,036 pounds

   a year: the full new state pension if it rises 3.9% next April

   It pays about 12,548 pounds a year now. [1][3]

   12,570 pounds

   of income a year before anyone pays income tax, frozen since 2021

   The freeze now runs until April 2031. [1][8]

   1 in 16

   retirees protected by the promised exemption, says Steve Webb

   About three-quarters of pensioners already pay tax on other income. [1][3]

   What happened

   • Britain's full new state pension is on course to pass the income tax allowance next April, for the first time. [1][2]
   • The Office for National Statistics said on 15 September that average pay, including bonuses, grew 3.9% in the three months to July. [1]
   • Under the triple lock, the pension rises each April by the highest of that pay figure, September's inflation figure or 2.5%. [5]
   • Pay is the highest so far. [2]
   • A 3.9% rise would take the full new state pension from 241.30 pounds a week to about 250.70, or roughly 13,036 pounds a year. [1][5]
   • The personal allowance, the income a person can have before paying income tax, has been frozen at 12,570 pounds since 2021. [1]
   • The freeze runs until April 2031. [8]
   • So about 466 pounds of the full pension would sit above the allowance.
   • At the 20% basic rate, that is roughly 93 pounds of tax a year. [1][9]
   • Nearly all of next April's rise, about 488 pounds, would land above that line. [1][3]
   • The rise is not final.
   • If September's inflation figure, published in October, is above 3.9%, that number is used instead, and the pay figure can be revised. [2]
   • It happened last year: in September 2025 the pension was reported likely to rise 4.7%, and it rose 4.8% in April 2026. [6][5]
   • At her Budget in November 2025, Rachel Reeves, then the chancellor, promised that people whose only income is the state pension would not pay tax on it in this Parliament. [3][20]
   • Small sums of tax are normally collected through Simple Assessment, where the tax office sends a bill at the end of the year. [3]
   • Nobody has said how the exemption will work instead. [1]
   • About three-quarters of pensioners already pay income tax because they have other income, such as a workplace pension. [3]
   • They include 2.5 million on the pre-2016 system. [3]

   Pensioner, state pension onlypromised no tax

   vsvs

   Pensioner, plus work pensiontaxed

   vsvs

   Worker on 13,036 poundsabout 93 pounds tax

   Who is involved

   • Steve Webb a former UK pensions minister, now at the consultancy LCP; he calls the UK government's plans a mess that helps few pensioners [1]
   • John Healey Britain's chancellor, in charge of tax and spending; he is drafting the Budget [1][8]
   • Rachel Reeves the previous chancellor; in November 2025 she promised no tax for people living only on the state pension [3]
   • Andy Burnham Britain's prime minister; he says he will look at the allowance at the Budget, with no commitment [8]
   • The Office for National Statistics Britain's official statistics body; its 15 September pay figure sets up the rise [1]

   How it unfolded

   1. Apr 2025 The full new state pension rises 4.1%, from 221.20 to 230.25 pounds a week [7]
   2. 2021 The tax-free allowance is frozen at 12,570 pounds [1]
   3. Nov 2025 Reeves promises no tax for people living only on the state pension [3][20]
   4. Apr 2026 The pension rises 4.8% to 241.30 pounds a week [5]
   5. 15 Sep 2026 Pay growth of 3.9% points to a rise of just under 500 pounds a year [1]
   6. Oct 2026 September's inflation figure decides whether pay or prices set the rise [2]

   Why it matters

   Watch September's inflation figure in October, and whether Healey's Budget explains how the exemption will work or moves the 12,570-pound allowance. [2][8]

   The truth

   • What is really going on Britain froze the income tax allowance at 12,570 pounds and kept raising the state pension every April, so next April the full new state pension is expected to pass it. [1]Britain's government has promised no tax only to people with no other income. [3]Steve Webb, a former pensions minister, says that covers about one retiree in 16. [1]
   • Why it works on people A headline promise of no tax for pensioners sounds like it covers every pensioner, and the condition that they have no other income is easy to miss. [3]
   • Who gains HM Treasury, Britain's finance ministry — Frozen thresholds mean pay rises and pension rises pull more income into tax without any tax rate going up. [9][1]
   • Who gains Pensioners living only on the new state pension — They have been promised no income tax on it in this Parliament, even above the allowance. [3]
   • Who pays Pensioners with a small workplace pension, and 2.5 million on the pre-2016 system — They get no exemption and pay tax on income above 12,570 pounds. [3]
   • Who pays Workers earning about the same as the full state pension — They pay income tax on the same amount the exempt pensioner keeps, about 93 pounds a year on 13,036 pounds. [3][1][9]
   • Nobody knows yet

     How the exemption for pensioners will actually work.

     No costing appeared in the Budget documents, and Webb says it is still an idea rather than a plan. [3] Experts told Alliance News the details are thin. [1]

   • Nobody knows yet

     How much the state pension will rise next April.

     September's inflation figure is not out until October, and the 3.9% pay figure can be revised. [2] Last year the likely rise was first reported as 4.7% and ended at 4.8%. [6][5]

   • Nobody knows yet

     Whether the triple lock itself lasts past this Parliament.

     Reeves promised to keep it until then, and Britain's official forecaster expects it to cost 15.5bn pounds a year by 2030, three times the original estimate. [4]

   • Nobody knows yet

     Whether the Budget moves the 12,570-pound allowance.

     Burnham said he would look at letting people earn more before paying tax, but his government has made no commitment. [8]

1. 02

   Bank of England expects prices above 4%

   What happened

   • On 17 September Andrew Bailey, governor of the Bank of England, wrote to the chancellor, John Healey, because prices rose 3.1% in the year to August. [10]
   • The rules require a letter whenever inflation is more than one point away from the 2% target. [10]
   • He said most of the gap came from fuel: petrol went from about 130p a litre in February to about 170p, and diesel from about 140p to 190p. [10]
   • Bank staff now expect inflation near 3.75% at the end of 2026 and a little above 4% early in 2027. [10]

   Petrol, February130 p

   Petrol, September170 p

   Diesel, February140 p

   Diesel, September190 p

   Why it matters

   Drivers feel the fuel rise at the pump first. [10]

   September's inflation figure, due in October, will also set next April's UK state pension rise if it comes in above 3.9%. [2]

   The truth

   • Who pays Drivers in Britain — Diesel went from about 140p a litre in February to about 190p, and petrol from 130p to 170p. [10]
   • Nobody knows yet

     How far fuel costs spread into food and other prices.

     The Bank of England says little has passed through to other goods so far, but expects it over the next few months. [10]

2. 03

   Euro countries' interest rate goes up

   What happened

   • The European Central Bank, which sets interest rates for the countries that use the euro, raised its rate to 2.5% a week before the US and UK central banks met. [11]
   • It said inflation was set to stay well above its 2% target for some time because of the Middle East conflict. [11]
   • A barrel of Brent crude, the main world oil price, was around 105 dollars. [11]
   • Central banks raise rates so that mortgages and credit cards cost more, people spend less, and prices slow down. [11]

   Why it matters

   Borrowers in euro countries whose loans follow the European Central Bank's rate will pay more.

   Higher rates also make saving pay better than spending, which is part of how they are meant to slow prices. [11]

   The truth

   • Who pays Borrowers in euro countries — The European Central Bank raised its rate to 2.5%, and loans that follow it get dearer. [11]

1. 04

   Trump promises 500 and 5,000 dollars

   What happened

   • President Donald Trump has promised two payments ahead of the US midterm elections in November. [12]
   • The first is a 500-dollar refund for nearly 1 million people in 30 states who buy health insurance on HealthCare.gov, the US government's online marketplace, expected from October. [12]
   • It comes from surplus fees paid by insurers, and is expected to go mainly to buyers earning over four times the poverty line, who get no subsidy. [12]
   • The second is a dividend of at least 5,000 dollars a person, excluding high earners, which would need Congress to approve it. [12]

   Why it matters

   The 500 dollars does not undo a 58% rise in the average marketplace premium payment this year, from 113 to 178 dollars a month. [12]

   The 5,000 dollars would cost about 1.3 trillion dollars, and the tariff money Trump points to is being refunded, about 100 billion dollars by the end of July. [12]

   How it works

   Exempt one group from a tax and the person just outside it still pays

   A tax exemption is a line. People inside it pay nothing, and someone with a little more income, or a different kind of income, pays tax as normal.

   The twist

   An exemption does not remove a tax. It chooses who pays it, and the people it leaves out often have no more money than the people it protects.

   The picture

   12345

   £11,000£12,250£13,500

   1. 1Full new state pension, 2024-25£11,502
   2. 2Full new state pension, 2025-26£11,973
   3. 3Full new state pension, 2026-27£12,548
   4. 4Tax-free allowance, frozen£12,570
   5. 5Full new state pension, 2027-28 if it rises 3.9%£13,036

   Step by step

   1. 1 The state pension goes up every April
   2. 2 The tax-free allowance stays frozen at 12,570 pounds
   3. 3 Next April the full pension passes the allowance
   4. 4 Britain's government exempts only people with no other income
   5. 5 Everyone just outside that group pays tax on the same money

   The same force, elsewhere today

   Where this chain is also running, in today's other stories.

   • Trump's 500-dollar health insurance refunds

     The refund goes mainly to buyers earning over four times the poverty line, so a buyer just under that line who also paid full price may get nothing.

   • Trump's 5,000-dollar dividend

     It would leave out high earners, and until Trump says where that line sits nobody knows who is just outside it.

   Where you've seen this

   First-time buyer tax breaks

   a relief that stops at one house price leaves the buyer of a slightly dearer home paying the full tax

   Free school meals

   a family a little over the income line pays for every lunch

   Travel passes by age

   a pass that starts at 60 charges a 59-year-old the full fare

   The catch

   Some line is hard to avoid: without the exemption, the tax office would have to collect small bills of about 93 pounds from millions of pensioners, which pension experts call an administrative headache.

   And the whole of it

   Most people sit near a line like this without knowing it: a pension, a benefit or a discount that stops at a set number. The person just inside it rarely meets the person just outside it, and neither of them chose where it was drawn.

   The truth

   • Who gains Nearly 1 million US marketplace health insurance buyers — They are due 500-dollar refunds from October, paid from surplus fees insurers paid. [12]
   • Nobody knows yet

     Whether the 500-dollar health insurance refunds are legal.

     Kiplinger reports questions over the administration's authority to make them. [12] A health policy expert said she knew of no precedent for returning such fees to buyers. [12]

   • Nobody knows yet

     How a 5,000-dollar dividend would be paid for.

     It would cost about 1.3 trillion dollars, and the tariff money named as its source is being refunded. [12] No plan has been published. [12]

1. 05

   UK regulator to check lawyers for dirty money

   What happened

   • Steve Smart, head of enforcement at the Financial Conduct Authority (FCA), Britain's financial regulator, said on 17 September that it will supervise money-laundering checks at 60,000 law and accounting firms from late 2028. [13]
   • Money laundering is hiding where criminal money came from so it can be spent. [13]
   • Smart said fraud was nearly half of all crime in England and Wales last year, and that more than 100 billion pounds is laundered through or within the UK each year. [13]
   • The FCA's systems now process over 56 million records a day. [13]

   Why it matters

   Law and accounting firms already have to check their clients and report suspicious activity under Britain's money-laundering rules. [13]

   What changes is who inspects them, and Smart said the few professionals who help criminals should expect to be found. [13]

   The truth

   • Nobody knows yet

     Whether the FCA can supervise 60,000 law and accounting firms.

     Smart himself called that a fair question, and the work does not start until late 2028. [13]

2. 06

   Whistleblowing to the FCA up 20%

   What happened

   • The FCA received 1,369 reports from whistleblowers in the year to March 2026, up from 1,131 the year before, its enforcement figures show. [14]
   • A whistleblower is someone who reports wrongdoing from inside a firm.
   • More than 40% of the reports led to direct action, and 53% fed its wider work. [14]
   • It also identified 30 suspected unregistered crypto brokers and a payment firm linked to about 30 million pounds of crypto payments. [14]
   • More than 75% of its enforcement work is about financial crime. [14]

   2024/251,131

   2025/261,369

   Why it matters

   Many problems inside a firm are invisible to its customers.

   The FCA says whistleblowing gives it insight that helps it stop harm and rule-breaking. [14]

   Good news

   • Reports from whistleblowers to Britain's financial regulator rose 20% in a year, to 1,369, and more than 40% of them led it to take direct action.
3. 07

   Five people fined and banned in August

   What happened

   • Britain's FCA fined five individuals in August 2026 and banned all five from working in financial services. [15]
   • On 12 August Paul Vincent Taylor was fined 489,000 pounds and Esmeralda Toni 121,200 pounds for failing to act with integrity in wholesale broking, which arranges deals between large financial firms. [15]
   • On 17 August Demetrios Christos Hadjigeorgiou, who worked in pensions, was fined 56,400 pounds for failing to take due care. [15]
   • On 25 August Denisz Andras Nagy was fined 324,800 pounds and Sanjay Maraj 122,000 pounds in wealth management. [15]

   Taylor£489,000

   Nagy£324,800

   Maraj£122,000

   Toni£121,200

   Hadjigeorgiou£56,400

   Why it matters

   A ban follows the person, not the firm, so none of them can simply move to another finance job.

   Three of the five looked after other people's savings or pensions. [15]

4. 08

   An adviser moved pensions with no insurance

   What happened

   • In May the FCA fined Frank Breuer 755,000 pounds and banned him from financial services. [15]
   • He ran Bluesky Wealth Management and moved at least 16 clients out of final-salary pensions, which pay a set income for life, knowing his firm had no insurance to cover bad advice. [16]
   • He paid himself large dividends and loans from the firm, then put it into insolvency in April 2023. [16]
   • That left at least 214,772 pounds owed to customers for the Financial Services Compensation Scheme to pay. [16]

   Why it matters

   The compensation scheme is Britain's safety net when a finance firm fails, and customers can still claim from it. [16]

   The case ran from 2019, when the FCA first restricted the firm, to this year's fine. [16][15]

   Good news

   • Customers badly advised by Frank Breuer's firm can still be compensated by Britain's Financial Services Compensation Scheme, which is meeting at least 214,772 pounds his firm owed them.
5. 09

   Medicare's 2027 drug costs are set

   What happened

   • Medicare, the US health programme for people over 65, has finalised next year's figures for its drug plans, Kiplinger reports. [17]
   • In 2027 the most anyone on a Medicare drug plan pays out of pocket is 2,400 dollars, up from 2,100. [17]
   • The deductible, which a patient pays before cover starts, rises to 700 dollars from 615. [17]
   • The monthly premium for Part B, which covers doctors and outpatient care, is projected at 209.50 dollars, up from 202.90. [17]

   Drug cost cap, 2026$2,100

   Drug cost cap, 2027$2,400

   Why it matters

   The Part B premium is usually taken straight out of Social Security, the US state pension, so part of each year's pension rise is gone before it arrives. [17]

   Medicare's trustees project that premium at 360.60 dollars by 2035. [17]

   The truth

   • Who pays US Medicare enrollees — The drug-plan deductible rises to 700 dollars in 2027, and the Part B premium taken from their pension is projected to rise to 209.50 dollars a month. [17]

   Good news

   • In 2027 nobody on a US Medicare drug plan will pay more than 2,400 dollars a year out of pocket for prescriptions. The figure is now final.
6. 10

   The US consumer regulator steps back

   What happened

   • The Consumer Financial Protection Bureau (CFPB) is the US agency that polices banks and lenders on behalf of customers.
   • Its report for October 2024 to December 2025 says it closed about 1,500 supervisory actions, 76% of those open. [19]
   • It also withdrew more than a dozen rules and nearly 70 guidance documents. [19]
   • On 1 May 2026 it rewrote a rule making lenders report loan applications from women-owned, minority-owned and small businesses, and moved the start date to 1 January 2028. [18]

   Why it matters

   The data was meant to show how women-owned, minority-owned and small businesses fare when they ask for credit, and none of it is now due before 2028. [18]

   The bureau's acting director says its examinations are now targeted and significantly scaled down. [19]

   The truth

   • Who gains US lenders covered by the small business data rule — The rewrite changed which lenders and data the rule covers, which the CFPB says reduces complexity for them, and moved the start to January 2028. [18]
   • Nobody knows yet

     Whether the US small business lending data will ever be collected.

     The start date moved to January 2028, and lenders' court challenges to the original rule are still going on in three places. [18]