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Growing numbers of UK adults are continuing to work past State Pension age — either through choice or financial necessity. Here is what you need to understand.Tax in RetirementYou still pay Income Tax in retirement if your total income exceeds your Personal Allowance (&poun...
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- Last Updated:
- 2 Jun 2026
- Category:
- Retirement Advice
- Reading Time:
- 1 min read
Growing numbers of UK adults are continuing to work past State Pension age — either through choice or financial necessity. Here is what you need to understand.
Tax in Retirement
You still pay Income Tax in retirement if your total income exceeds your Personal Allowance (£12,570 in 2024/25). State Pension, private pension income and employment income are all combined for tax purposes.
National Insurance
Good news: once you reach State Pension age, you stop paying National Insurance contributions, even if you continue working. This gives you an automatic pay rise equivalent to NI savings.
Effect on Benefits
Working may affect means-tested benefits such as Pension Credit. Always check before accepting work if you currently receive means-tested support.
Self-employed? Visit Self Employed Money for UK tax guides and financial tips for freelancers.
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I've been wondering if working part-time after retirement might affect my Pension Credit. Could anyone share their experience?
Useful read. A point to note - since April 2016, the 'contracting-out' element no longer affects State Pension age for new pension schemes, but it's still relevant for those who started saving earlier.
I'm a recent retiree in Norfolk, glad to know I'll save on National Insurance now even if I take up some part-time work. Great info!
Did you know? If your State Pension is less than your full Personal Allowance (£12,570 in 24/25), it won't be taxed. This can make working post-retirement more attractive.
It's worth noting that if you're still paying National Insurance above State Pension age due to high earnings, consider applying for NICs refund.
I'm not sure I understand why working after retirement means you automatically stop paying National Insurance. Could someone clarify that for me?
Important to note: if you're delaying taking your State Pension to earn more, ensure it's taxed at the right rate. Consider using HMRC's 'Check your State Pension' service.