In our weekly series, readers can email in with any questions about retirement and pension savings to be answered by our expert, Rachel Vahey, head of public policy at investment platform AJ Bell. There is nothing she does not know about pensions. If you have a question for her, email us at money@theipaper.com.

I receive the old state pension with the maximum additional state pension. Will I be taxed?

State pensions – whether they are the old basic state pension or the new single state pension – are taxable and have always been so.

However, they are paid gross, so no tax is deducted before they are paid. This isn’t a problem where the state pension someone is receiving is below the personal tax allowance and they receive no other income.

If a pensioner does have other income – such as earnings or a private pension – and that takes their total income above the personal allowance, their employer or pension provider will deduct income tax from that income.

To make sure they are paying the right amount of tax this calculation will be based on their total income, in other words including their state pension as well.

If the pensioner only receives the state pension, and that is above the personal allowance – as you rightly point out the basic state pension plus the additional pension, also known as SERPS, could place some in this situation – then they owe income tax, and HMRC should collect this by simple assessment.

Both the new state pension and the old basic state pension will rise by 3.9 per cent next April. (The earnings-related additional pension paid under the old system will increase by 3.5 per cent.)

However, the personal allowance – the amount you can receive each year before paying income tax – remains frozen at £12,570. As state pensions grow in value, more pensioners could theoretically face a tax bill. And that is why the Government is introducing an extra tax-free allowance from 6 April 2027, called the Pension Tax Allowance, for pensioners on lower incomes.

Pensioners with a total annual income of up to £13,037 should receive the full new allowance meaning they won’t have to pay any income tax and saving them up to £94 a year. This applies whether their income comes from the new state pension, the old basic and additional state pensions, paid work or a private pension.

Those with an income between £13,037 and £13,319 will receive a smaller pension tax allowance and have to pay some income tax. Pensioners with an income of £13,319 or more will pay income tax on any income over £12,570.

While the introduction of the pension tax allowance will provide some welcome relief for lower-income pensioners, its impact is likely to be limited.

The Government estimates it will only help a very small band of pensioners – around half a million will benefit from a tax reduction next tax year – but many others will see little or no benefit.

For pensioners, the key point is that receiving the state pension does not automatically mean it is tax-free, and those whose state pension is above the personal allowance this tax year should get a simple tax assessment.

Next year, the thresholds will change with the introduction of the pension tax allowance, but the same principles apply – some pensioners whose only income is their state pension may still face an income tax bill.