The full new State Pension is projected to exceed £13,000 per year for the first time in April 2027, following the release of pivotal wage growth data. According to figures confirmed by the Office for National Statistics (ONS) on September 15, 2026, average earnings growth for the period between May and July reached 3.9%.
Under the “Triple Lock” mechanism, the State Pension increases each April by the highest of three measures: average earnings growth, Consumer Price Index (CPI) inflation, or 2.5%. With the earnings figure now established at 3.9%, the annual payment is set to rise from the current rate of £12,547.60 to approximately £13,036.40. This equates to a weekly payment of £250.70, up from the 2026/27 rate of £241.30.
The Tax Implications of the £13,000 Milestone
While the increase provides more nominal income for retirees, it also triggers a significant tax threshold breach. The personal tax allowance—the amount of income an individual can receive before paying income tax—is currently frozen at £12,570 and is expected to remain at this level until at least 2028.
An annual State Pension of £13,036.40 exceeds this tax-free limit by £466.40. Consequently, retirees who receive the full new State Pension will likely see a portion of their benefit subject to the 20% basic rate of income tax, even if they have no other sources of income. Analysis of these figures suggests that this “stealth tax” could effectively claw back a portion of the annual increase from millions of pensioners.
Eligibility and How to Check Your Forecast
The projected £13,036.40 figure applies only to those eligible for the full new State Pension. Eligibility is determined by an individual’s National Insurance (NI) record. Generally, 35 qualifying years of contributions are required to receive the full amount, while a minimum of 10 qualifying years is necessary to receive any portion of the State Pension at all.
Individuals can verify their specific status and projected retirement income by using the “Check your State Pension forecast” service on the GOV.UK website. This tool provides a personalized breakdown of:
- The estimated amount of State Pension you are on track to receive.
- The date you will reach State Pension age.
- Any gaps in your National Insurance record that could reduce your final payment.
Addressing Gaps in National Insurance
For those with gaps in their record, the opportunity to make voluntary contributions to boost their pension has become more restricted. A significant window that allowed individuals to “buy back” missing years dating from April 2006 to April 2016 officially closed on April 5, 2025. Following the closure of this extended window, most people can now only pay for gaps occurring within a six-year rolling window.
It is important to note that the final State Pension increase for April 2027 will not be officially confirmed until the autumn, as the government must also consider the inflation figures for September. However, with the 3.9% wage growth figure currently leading as the most likely peg, the £13,000 threshold remains the central projection for the upcoming tax year.
