Hi, my name is HRIBBY! Will I be taxed on my pension pot and will it affect my state pension?

HRIBBY
HRIBBY Online Community Member Posts: 1 Listener
edited November 7 in Benefits and income

I have a pension pot of,currently £12,400 ,I am claiming full state pension(£230),will i be liable for tax on this,and will my state pension be reduced because i am over the threshold

Comments

  • MW123
    MW123 Scope Member Posts: 1,715 Championing

    @HRIBBY welcome to the community.

    The State Pension is not means tested. You receive it based on your National Insurance record, not your income, savings, or assets.  

    However, both your State Pension and any personal pension withdrawals count as taxable income. If the total goes over the Personal Allowance currently £12,570, you’ll pay 20% income tax on the amount above that.  

    Your pension pot £12,400  isn’t counted unless you take money out. But if you do, the amount you withdraw is added to your State Pension,  and it’s the combined total that is used to work out if you owe tax.

  • Mary_Scope
    Mary_Scope Posts: 3,085 Scope Online Community Children and Family Specialists

    Hi @HRIBBY and warm welcome to the community from me!

    I see MW has already answered your question and given some great advice so I won't add anything else today but it's lovely to have you on the community and I hope you enjoy your time here😊

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