Hmrc flags 1.7 million pensioners over £5 tax error
hmrc says around 1.7 million pensioners could have paid too much tax because it used the wrong state pension figure on some self-assessment returns. The issue affects only people who receive the state pension and also file self-assessment, and HMRC says the difference is around £5 in most cases.
The department said people who think the state pension amount on their return is wrong can change it before filing, and those who have already overpaid can ask for a repayment. The deadline for checking and amending returns is January 31 2027.
HMRC and the state pension figure
HMRC rules say state pension income should be worked out using 51 weeks at the current year’s rate and one week at the previous year’s rate. HMRC has been using 52 weeks at the higher current-year rate instead, which pushed the pension figure on to some returns. HMRC said: “We apologise to those affected by this calculation error, although the impact is small with the difference in tax owed being around £5 in most cases.”
People whose income only comes from the state pension, workplace pensions or savings interest usually do not need to fill in a self-assessment tax return. The mistake sits inside the smaller group that does file one, including people with more complex income such as the self-employed or buy-to-let landlords.
Check the DWP uprating letter
HMRC said anyone who has not yet filed should cross-check the figure on the return against the DWP uprating letter sent before the start of the 2026-27 tax year. That letter told recipients their new weekly rate for the year. If the figure is wrong, they can manually overtype it on the self-assessment form before submitting.
If a return has already been submitted and tax was overpaid, HMRC said people can amend the return online or contact HMRC directly to request a refund. Steve Webb, partner at pension consultants LCP, said: “The way the state pension is taxed is a regular source of confusion, but it is worrying that HMRC seem to have been getting it wrong themselves.”
January 31 2027 deadline
The warning affects only a small proportion of the 13.2 million people receiving the state pension, but it gives affected taxpayers a clear task now: check the state pension amount against the DWP letter, correct any wrong figure, and review whether they have paid too much. For those who have already filed, the repayment route is open before the January 31 2027 self-assessment deadline.
