What changes for older people from April 2027? Budget 2026

Updated 2 November 2026 with new details on the National Care Service, the State Pension and the £100 energy payment.

The Autumn Budget was announced on 28 October 2026. It brings several changes for older people, and most of them start in April 2027.

One of the main changes is a new Pension Tax Allowance, which means some pensioners won’t pay income tax at all. There’s also help with energy bills, and a change to how health benefits like Personal Independence Payment (PIP) are assessed. The Budget also confirmed plans for a National Care Service, which would make personal care free for older people in England.

Here’s what’s changing and when.

The new Pension Tax Allowance

From April 2027, you won’t pay income tax if you’re over State Pension age and your total income is no more than the full new State Pension. The government calls this the Pension Tax Allowance. People who reach State Pension age during the tax year are also eligible.

The allowance will apply from 6 April 2027 to 5 April 2030. The government hasn’t yet decided what will happen after that.

Around 500,000 pensioners will benefit in 2027-28, according to the government. About 290,000 of them won’t pay any income tax. The rest will get a reduced allowance.

This matters because the State Pension is about to rise above the standard £12,570 tax-free allowance, which stays frozen for 2027-28. From April 2027, the full new State Pension will go up by 3.9% to £13,036.40 a year, according to the Government Actuary’s Department. Without the new allowance, people living only on the State Pension would have started paying income tax. The Pension Tax Allowance will be worth up to £94 in 2027-28.

Chancellor John Healey said these pensioners “will not pay income tax in this Parliament”, City AM reports.

State Pension age is rising from 66 to 67, depending on when you were born. You can check your State Pension age on GOV.UK.

Changes to the triple lock

From April 2030, the State Pension will rise each year by the highest of 2.5%, inflation, or the amount needed to keep its value in line with earnings at April 2029 levels, according to the Government Actuary’s Department. The government says the savings will fund the new National Care Service.

Help with energy bills

In 2027, up to 20 million households in England will get a £100 Household Energy Payment. It’s for homes in council tax bands A to D. The government will provide funding for similar support in the rest of the UK.

Payments are expected to start from January 2027. If you pay council tax by Direct Debit, the money should go straight into your bank account. If you don’t, your council will set up a way for you to give them your bank details, MoneySavingExpert reports.

The temporary VAT cut on electricity bills will also run until 1 July 2027. The government says this will take around £50 off the Ofgem price cap from April 2027.

PIP and health benefits

Personal Independence Payment (PIP) helps with extra living costs if you have a long-term health condition or disability. It’s for people who find everyday tasks or getting around difficult. You can get it even if you work or have savings.

You usually need to be under State Pension age to make a new PIP claim. People over State Pension age can usually apply for Attendance Allowance instead.

In Scotland, new claims are made for Adult Disability Payment instead of PIP. After State Pension age, people in Scotland can apply for Pension Age Disability Payment instead of Attendance Allowance.

If you or someone you care for claims PIP or another health benefit, here’s what the Budget says.

• More face-to-face assessments. The government says it will increase face-to-face assessments for health benefits. It has already more than doubled the rate of these assessments since July 2024.
• The PIP review. The government will look at the recommendations from Sir Stephen Timms’ review of PIP. No changes from the review were announced in the Budget.

The Budget also brings in new measures to tackle benefit fraud and error. The government expects these to save £1.4 billion between 2027 and 2032.

Savings and fuel

• Tax on savings income goes up. From April 2027, income tax on savings and property income will rise by two percentage points in every band. The government estimates that 84% of income taxpayers won’t see their tax bill rise as a result of these changes. The £20,000 cash ISA limit isn’t changing.
• Fuel duty stays lower for longer. The 5p cut in fuel duty has been extended for six months. The planned inflation-linked rise in fuel duty is delayed until 1 July 2027.

What about social care?

The Budget confirmed plans for a National Care Service in England, which the government first announced on 29 September. It would make personal care free at the point of use for older people. Personal care means help with things like washing, eating and using the toilet.

It won’t cover bed and board. Councils will still means-test those costs.

The National Care Service won’t start straight away. It’s planned for the next Parliament and will be brought in gradually. Baroness Casey’s Independent Commission on Adult Social Care will report in 2027 on how it should work.

On 8 October, the government announced new funding for dementia research. Read more in our article on £48m for dementia research: where the money goes.