State pension set to rise by 3.9% – how much could you get?

Pensioners are set to get a 3.9% increase in their state pension next April, which will mean the full new amount rises above £13,000 a year for the first time.

Under the triple lock mechanism, the state pension rises each April by the highest of the previous September’s Consumer Prices Index (CPI) measure of inflation, 2.5% or average earnings growth from the previous May to July.

CPI inflation rose by 3.5% in the 12 months to September 2026, while revised earnings figures published in October showed earnings in May to July 2026 increased by 3.9%.

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This means the state pension is set to go up by 3.9% from April 2027. Chancellor John Healey will likely confirm this in the 2026 Autumn Budget.

Jon Greer, head of retirement policy at wealth management firm Quilter, said: “This will be welcome news for millions of retirees, particularly after another year in which many household budgets have remained under pressure.”

How much will the state pension rise by?

The full new state pension, paid to men born on or after 6 April 1951 and women born on or after 6 April 1953, is set to increase from £241.30 per week (around £12,547 per year) to £250.70 per week (around £13,036 per year) from April.

The basic state pension, paid to older pensioners, is set to increase from £184.90 a week (around £9,614 per year) to £192.10 (around £9,989 per year).

Some people don’t benefit from the state pension triple lock and those on the old state pension won’t see all elements of their pension rise in line with the mechanism.

For example, additional amounts such as SERPS or state second pension are inflation-linked.

Meanwhile, extra amounts of state pension received from deferring don’t rise in line with the triple lock and increase based on inflation.

Will retirees have to pay tax on their state pension?

More pensioners face paying income tax from April 2027 due to the ongoing freeze to income tax bands and a rising state pension.

A recent Freedom of Information (FOI) request submitted by Steve Webb, former pensions minister and now consultant at LCP, revealed hundreds of thousands of pensioners are gradually being pulled into paying more tax due to frozen tax thresholds and rising incomes.

With the full new state pension set to breach the £12,570 personal allowance, even pensioners whose sole income is the state pension will be pulled into the basic rate tax band.

However, in September, Torsten Bell, minister for pensions, confirmed that pensioners whose sole income is the state pension who exceed the personal allowance won’t have to pay tax on it, reaffirming a commitment made by former chancellor Rachel Reeves in 2025.

He added: “The chancellor will set out further details on how that commitment will be delivered at the Budget.”

Analysis by LCP suggests, as the policy currently exists, one in 16 pensioners will benefit from the commitment.

How to protect yourself from income tax

There are ways pensioners facing a greater income tax bill from next April can lessen the blow.

James Norton, head of retirement and investments at investment firm Vanguard Europe, said: “For those with other sources of retirement income, given the personal allowance remains frozen at £12,570 and the higher rate tax threshold has stayed at £50,270, a considered approach to tax and retirement is needed to make sure you keep as much of your hard-earnt savings as possible.”

One tip is to only draw the pension income you need. Leaving surplus funds in your pot will allow it to grow while reducing your taxable income.

You can also make the most of tax-free accounts like ISAs, ensuring any investment gains or interest earned from savings are shielded from tax.

Couples can make the most of each other’s allowances to lower overall tax bills as well. For example, if you’ve used up your capital gains tax (CGT) allowance for the tax year, you could transfer assets to a partner who hasn’t used their full allowance to lower your combined CGT bill.

Changes afoot for the triple lock

The state pension will continue to rise under the triple lock for now, but will be scrapped in April 2030 if Labour stays in power, prime minister Andy Burnham said in September.

He plans to replace the mechanism with a double lock to help fund a new free social care service.

It comes as the cost of the uprating system rises as people live longer and there are fewer workers to fund the state pension.

Previous projections by the Office for Budget Responsibility (OBR) suggested the triple lock would have cost 9% of GDP by 2075/76, up from 5% now, in part due to the triple lock.

Helen Morrissey, head of retirement analysis at investment platform Hargreaves Lansdown, said: “We don't know exactly how much the triple lock reforms will affect future state pension incomes, but for those concerned how the latest changes may impact your retirement income it pays to be organised and plan ahead.

“Even relatively small increases in your pension contributions now could make a big difference to your retirement income in the long run and cover any shortfall.”