Personal tax allowance HMRC latest as 'more people paying more'

New data has been released07:02, 31 Jul 2026Updated 07:03, 31 Jul 2026Retired people paid approximately £8bn in additional tax last year after a freeze on personal allowances pushed individuals into higher tax brackets, according to newly released figures. The total tax paid by those in retirement rose from £21.1bn to £29.8bn, a surge of more than 40 per cent in just two years, based on the latest pension participation data from HMRC.‌Industry experts attributed the increase to so-called fiscal drag, whereby people have been drawn into higher tax bands as thresholds and personal allowances remain frozen.‌Steve Webb, partner at LCP and former pensions minister, said: "The constant freezing of tax thresholds and allowances has dragged millions more people into paying higher rates of income t