The average retired household handed £7,400 to the taxman during the first year of pension freedom, amounting to almost a third (30%) of their annual income, according to data analysis by Prudential.
The data, taken from the Office for National Statistics, showed retirees' tax bills rose £400 on average in the 12 months to April 2016, meaning the Exchequer pocketed an extra £1.7bn. The total annual tax bill for the UK's 7.1 million retired households for the 2015/16 tax year was £52.7bn. Prudential said the majority of the increase came from direct taxation, which increased by some £300 on average from its 2014/15 level. This meant typical retired households paid about £1,970 in income tax in 2015/16, compared with about £1,700 in the previous tax year. The insurer added the in...
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