Answers · UK 2025/26

Will I pay tax on my State Pension once I add drawdown income on top?

Often yes. The full new State Pension of £12,548 a year nearly uses up your £12,570 Personal Allowance, so almost all of any drawdown or other pension income on top is taxed, mostly at 20%. The State Pension is paid without tax deducted, so HMRC collects it via your other pension's tax code.

Last updated: 10 June 2026Last reviewed: 10 June 2026How we verify

Full answer

The State Pension is taxable but is always paid gross, with no tax taken off at source. For 2026/27 the full new State Pension is £241.30 a week, about £12,548 a year, which sits just under the £12,570 Personal Allowance. That means once you add any private or drawdown income, almost all of it is taxable because your allowance is nearly used up. Worked example: you receive the full new State Pension (£12,548) plus £15,000 a year of taxable drawdown income, for total income of £27,548. The Personal Allowance £12,570 is set against the combined income, leaving £14,978 taxable at 20% = about £2,996. HMRC cannot deduct tax from the State Pension itself, so it usually adjusts the tax code on your drawdown or annuity provider, often reducing the allowance applied there, so the tax on both sources comes out of the private pension. If your only income were the State Pension, you would pay no tax, since £12,548 is below £12,570. Note the State Pension does not attract National Insurance once you are over State Pension age. Use the income tax calculator to combine State Pension and drawdown income. For how it is taxed see gov.uk at https://www.gov.uk/tax-on-pension.