Pensioners Hit 40% Tax Rate

More than 1 million pensioners in the UK are now paying income tax at a rate of 40% or higher, according to new figures obtained by financial consultancy LCP. This marks a significant increase from 2021/22, when only 494,000 pensioners were in this tax bracket.

LCP partner Steve Webb revealed through a Freedom of Information request that the number of pensioners paying tax at the 40% or 45% rates has risen to 1.092 million in 2026/27. This indicates a substantial shift in the tax setting for pensioners, with the number paying the highest 45% rate having roughly trebled over the same period.

Tax Brackets Shift for Pensioners

The rising number of high-taxed pensioners could have implications for public finances and economic policy. As pensioners’ income grows, so does their contribution to the country’s tax base. This could ease pressure on public finances, but it may also raise questions about intergenerational fairness and the sustainability of the pensions system.

FNZ Appoints New UK Client Head

Wealth management platform FNZ has appointed Maarten Heukshorst as its new head of client management and business development in the UK. Heukshorst brings over 25 years of senior commercial and executive experience in financial services to the role, having previously held positions such as chief commercial officer at Centralis Group and chief executive at Custodiex.

His appointment comes as FNZ is expanding its UK operations and looking to grow its client base. Heukshorst’s extensive industry experience and commercial acumen will be invaluable in driving this growth and strengthening FNZ’s position in the UK market.

As the summer ends and politicians return to Westminster, speculation is mounting over Andy Burnham’s first Budget next month. Market resilience has been remarkable despite political headwinds and market volatility, but all eyes are now on the Chancellor’s fiscal plans and where any tax rises might fall.

Research from Wesleyan reveals that seven in 10 financial advisers expect to increase their use of smoothed funds over the next 12 months, with most saying recent market volatility has made the funds more suitable for certain clients. The research also found that most advisers have already increased their use of smoothed funds over the past year, and that investment solutions need to evolve in response to changing market conditions.