Next year there will be a financial boost for people in receipt of the state pension, it has been confirmed by the UK Government.
The basic and single tier pension rates, and other state pension benefits, to be introduced from April 6 has been confirmed.
Those receiving the basic state pension will have reached the state pension age and qualified before April 2016, as well as any additional state pension they have built up.
Those receiving the new single-tier state pension will have reached the state pension age after April 2016.
The current eligible age to receive the state pension is 65 for both men and women, with those eligible having made National Insurance contributions.
A number of state pension age rises are due in the future, with increases to 66 (2020), 67 (2029) and 68 (between 2037 and 2039) planned.
This is how much those receiving the state pension will get in 2019/2020 according to Which?
Basic state pension rates
Those receiving the basic state pension will get a weekly boost in 2019/2020.
Recipients will get an extra £3.25 a week, increasing the state pension from £125.95 to £129.20.
Retired workers in this group will then have £169 more for the year, which works out as an annual income of £6,718.40.
New state pension rates
It’s also good news for those entitled to the full new single-tier state pension.
Those receiving this will see an increase from £164.35 to £168.60 – which means an additional £4.25 a week.
That’s £221 extra by the end of the 2019/2020 tax year, which raises the total annual income to £8,767.20.
Additional state pension rates
“If you reached state pension age before April 2016, your state pension will be made up of two parts; the basic state pension and the additional state pension – sometimes referred to as the second state pension,” revealed Which?
The additional state pension only increases by the rate of CPI inflation, which was announced in September, rather than being linked to the triple lock guarantee.
This means that the additional state pension will increase only by 2.4% from April 2019.
There remains a cap on the maximum additional state pension you can earn, though this rises from £172.28 per week to £176.41 per week in 2019/2020.
This means-tested benefit is awarded based on earnings, and from April 2019 both pension credit payments will rise by 2.4%, the CPI rate of inflation.
Guarantee credit, the first part of pension credit, will subsequently increase from £163 a week to £167.25 per week for a single person and from £248.80 to £255.25 for a couple.
The second part, savings credit, will see its cap rise from £13.40 to £13.72 for a single person, and from £14.99 to £15.35 a week for a couple.
Personal lifetime allowance
The pension lifetime allowance is the maximum amount that you can put into your retirement savings without being taxed.
It increases based on the rate of CPI inflation, which means that from next year, the pensions lifetime allowance will increase from £1,030,000 to £1,055,000.
According to Which?, this means an extra £24,800 in tax-free pensions savings that you can make.