HMRC to send 400,000 warning about new bill

Up to 400,000 pensioners are set to receive warning letters from HM Revenue and Customs (HMRC) this month over a new bill.

The state pension increased by 8.5 per cent at the start of April with the full basic state pension rising to £8,814 and the new state pension to £11,502. This increase will push hundreds of thousands of individuals into the income tax payment bracket.

Anyone earning more than £12,750 will have to pay income tax, which could include pensioners receiving another state pension. The additional state pension consists of three different schemes: the state second pension (2002-2016), SERPS (State Earnings Related Pension Scheme, 1978-2002), and the state pension top-up (October 12, 2015 - April 5, 2017), the Express reports.

Read more: Money Saving Expert says people aged 43 to 70 can turn £800 into £5,500

When combined with a basic state pension, these amounts could result in certain pensioners receiving an extra £200 per week, potentially exceeding the tax allowance. Tax expert Andy Wood from Tax Natives warned: "If your state pension is over £242 per week, you may face unexpected tax bills due to the frozen personal tax allowance."

"With an 8.5 percent increase in state pension from April, pensioners receiving over £242 per week may enter the tax net. The frozen tax threshold of £12,570 heightens the risk of unexpected tax demands."

Pensioners are set to receive a significant increase in their state pension, with those on the full new state pension seeing their weekly amount rise from £203.85 to £221.20, equating to an additional £902 annually. However, they should be mindful of the tax implications due to the unchanged personal tax allowance threshold.

A spokesperson clarified: "HMRC may use a