This information applies to England, Wales, Scotland and Northern Ireland
When you are over 65 you still have to pay tax on your income, but your tax free allowance is higher than before you were 65. Your taxable income includes your occupational pension or personal pension if you have one. Some social security benefits are also taxable, for example, your retirement pension. You may also have income in the form of interest from savings or shares, from rental on property that you own or earnings from any work you are doing.
If your only taxable income is basic rate state retirement pension (excluding graduated or additional pension) you will not pay any tax. This is because your tax free allowance will be more than the basic pension.
If you are working, either full-time or part-time, your earnings will be taxed under the PAYE system. Any tax due on your other taxable income, for example, state retirement pension, will be deducted from your earnings under the PAYE system.
You may be sent a Self-Assessment tax return form. If you are not sent a form and you have income which is taxable, it is your responsibility to ask HM Revenue and Customs to send you a form.
If you have savings, tax is usually deducted from the interest before you get it. If your income is low, you may be able to claim back tax that has been paid on your savings interest. You can find further information about claiming back tax that you have overpaid on your savings from the HMRC website at www.hmrc.gov.uk.
If you are a higher rate tax payer, you will have to pay extra tax on your income from savings or investments. You need to enter this on your tax return.
If you have a drop in income when you retire, you may be entitled to a tax refund.
There is more information about tax and pensions on the HMRC website at www.hmrc.gov.uk.
For more details, including an explanation of the tax codes you may encounter, see Income tax and pensioners.
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