Retired households face 15.4% tax rate hit on income - research

Total direct tax adding up to more than £57.22 bn

Julia Bahr
clock • 1 min read

Retired households have been hit by a 15.4% direct tax on their income each year, recent research from pension provider iSIPP has shown.

The analysis of the most recent government data suggested that their average bill for direct taxes is £4,961 annually, with the total direct tax taken from retired households adding up to more than £57.22bn. iSIPP found the average gross income of retired households was £32,265 with benefits including the state pension accounting for 41% of total income. According to the research, income from private pensions accounted for 43% of gross income. Income tax and council tax plus a small amount of National Insurance (NI) contributions took £4,961 off retired households' income. The bigg...

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