State Pension Tax and HMRC Refunds: Why 52 Weeks Is the Wrong Number

HMRC does not tax a full year of State Pension as 52 times the weekly rate. Its published method is one week at the previous year’s rate plus 51 weeks at the current one, which on 2026-27 rates makes the taxable amount £12,536.55 rather than £12,547.60. That eleven-pound gap is also the root of one of the two refund stories now being reported as though they were the same story.

What is your State Pension actually taxed on?

A full year’s State Pension is taxed as one week at the weekly rate in force before the April uprating, plus 51 weeks at the rate after it. HMRC set that out in guidance called “How your State Pension is taxed”, published on gov.uk on 7 July 2026, with a worked example in round numbers: £160 for one week plus £170 for 51 weeks, giving £8,830.

The annex to HMRC’s 1 July 2026 letter to the Public Accounts Committee states the same calculation in different words and adds the reason: the State Pension is taxed on an accruals basis and the DWP generally pays it in arrears, on a payday set by your National Insurance number. No gov.uk page set out that rule before July 2026, which is much of why the 52-week figure went unchallenged so long — including on this site.

Why is £12,547.60 the wrong annual figure?

Because it multiplies the 2026-27 weekly rate by 52, and HMRC’s own method does not. Applying the published method to the 2026-27 rate of £241.30 and the 2025-26 rate of £230.25 gives £12,536.55 — £11.05 less, worth £2.21 in tax at the basic rate.

That is Drawpie arithmetic applying a method HMRC publishes, not a figure HMRC has printed. HMRC gave the method and the weekly rates but no annual taxable amount. The rates come from statute — SI 2026/148 substitutes £241.30 for £230.25 as the full rate.

The £11.05 is that year’s uprating step, and HMRC keeps a series of exactly these: its annex tabulates the weekly difference from the previous year from 2010/11 to 2025/26, and the new State Pension row for 2025/26 is £9.05 — precisely £230.25 minus £221.20.

Two caveats travel with the sum. It assumes you were on the full rate throughout 2025-26; anyone reaching State Pension age part-way through a year gets a weeks-remaining calculation instead. And one plus 51 is 364 days, so the convention is a day short of the tax year by construction.

For the rates and the pension age table, see the 2026-27 pension changes ; for what a missing year costs, National Insurance qualifying years .

How much Personal Allowance is left in 2026-27?

£33.45 a year on a full new State Pension, rather than the £22.40 the 52-week sum gives. The Personal Allowance is £12,570 for 2026-27, unchanged.

Eleven pounds of headroom will not change anyone’s year. What makes it worth printing is what it reveals: 52 times the current rate is not a rounding shortcut, it is the computation HMRC identified as a defect in its own systems and is now spending public money putting right.

Who gets a refund automatically?

Around 3.2 million people, with no claim required, because HMRC’s systems used the 52-week figure in some tax calculations. John-Paul Marks, HMRC’s First Permanent Secretary and Chief Executive, wrote to Dame Meg Hillier of the Treasury Committee on 3 September 2026 saying HMRC will identify affected customers and correct their tax positions without requiring a claim, for tax years from 2020-21, with repayments totalling around £19.3 million.

Divide one by the other and the average is about £6.03 a head — our arithmetic, since HMRC prints no average. The money is to arrive through PAYE coding adjustments, Self Assessment credits or, where necessary, payable orders, and HMRC expects to complete the majority by 31 March 2027.

The fault is older than the correction. HMRC’s 1 July 2026 letter says it “stems from a PAYE systems change introduced in 2010”, and its annex gives the reach: PAYE reconciliations since 2010/11, Self Assessment pre-population since 2015/16, Simple Assessment since 2016/17. The forward fix went in on 25 August 2026.

Those are HMRC’s counts of pensioners affected in PAYE and potentially affected in Simple Assessment, and its table stops at 2024/25. A third column, for Self Assessment, reaches 955,000 in 2024/25, which HMRC calls an upper limit rather than a count. Before 2020-21 there is no automatic correction — you can ask for a review if you have evidence, judged case by case.

Why will most pensioners get nothing?

Because a wrong figure did not always mean wrong tax was paid. HMRC says most of the differences fall inside its longstanding administrative tolerances, under which very small overpayments are not automatically repaid and small underpayments are not pursued — so for most pensioners nothing changed hands either way.

The scale of those tolerances is the most dropped detail in the coverage. In 2024/25 HMRC did not collect underpayments below £49.99 from around 4.65 million pensioners, and did not automatically repay around 118,000 owed less than £9.99.

The per-person amounts explain why. HMRC estimates the average over-taxed amount in any single year between 2021/22 and 2024/25 was £1.76 on the full basic State Pension and £2.30 on the full new one, at the basic rate. Its year-by-year table peaks at £3.74 for the new State Pension in 2023/24 — with higher-rate and additional-rate columns roughly double and two-and-a-quarter times that, so £7.48 and £8.42.

What is the refund that averages thousands?

A different thing entirely: the emergency tax taken off a flexible withdrawal from a defined contribution pot, which you get back early only if you send HMRC a form. In the quarter from 1 April to 30 June 2026, HMRC repaid £50,353,656.76 on 12,612 reclaim forms — an average of £3,992.52 per form.

The cause is mechanical. HMRC’s PAYE manual says that for a first flexibly accessed pension payment the scheme administrator uses the emergency tax code on a Month 1 basis, which taxes it as though the same amount would arrive every month for the rest of the year. A single large withdrawal is taxed as if annualised. HMRC announced in January 2025 that from April 2025 it would automatically move people off temporary codes onto cumulative ones, but said the rules for taxing first pension payments were not changing — so that fix helps repeat withdrawals, not the one-off that over-taxes worst.

The most recent quarter is the highest total and the highest average of the seven, on the fewest forms bar one. One warning: those are claim forms processed in the quarter, not distinct people, and not everyone who was over-taxed. Anyone who does nothing is reconciled at year end instead.

Which form do you need: P55, P53Z or P50Z?

It depends on whether you emptied the pot and whether you still have other income. Three forms cover flexible access; a fourth covers small pots.

How the money comes back differs by form, which almost no coverage mentions. A P55 repayment is made by Faster Payments into a bank account in your name or your nominee’s. A P53Z repayment comes as a payable order and cannot be paid by Bacs — and HMRC cannot deal with a P53Z claim without parts 2 and 3 of every P45 issued for the pension payments.

If you do not claim, HMRC reconciles the year anyway and writes with a P800 or Simple Assessment, sent between June and March of the following tax year. Where a P800 lets you claim online, the money follows within five working days, or about six weeks by cheque.

How long do you have to claim?

Four years after the end of the tax year. That means the 2022-23 tax year can still be reclaimed until 5 April 2027, while 2021-22 closed on 5 April 2026 and cannot be reopened.

HMRC’s State Pension sweep reaches back to 2020-21 — further than you could now claim for yourself, and the furthest HMRC says its data lets it identify cases reliably. For a 2025-26 Simple Assessment, the payment deadline depends on when the letter arrived: before 31 October 2026 and you pay by 31 January 2027; on or after that date and you have three months from the letter.

Is there a third payment people are confusing with these?

Yes, and it is not a tax refund at all. The low earner’s pension payment is a top-up worth 20% of gross workplace pension contributions for people in net pay arrangement schemes whose taxable income sat below the Personal Allowance, so they never got the relief that relief-at-source members received automatically. It applies from the 2024-25 tax year.

HMRC set it out in its pension schemes newsletter of 27 August 2026, under regulations laid before Parliament on 23 June 2026, and it is underway rather than upcoming — HMRC has been contacting people since August 2026, with notifications running into early 2027. The difference that matters is that this one is not automatic: you have to accept the offer and supply bank details through your personal tax account or by phone, and it will not be paid by cheque. LCP has warned publicly that non-take-up could be large.

What to actually do

1. If you have taken a one-off taxable lump sum from a defined contribution pot in 2026-27, work out which of P55, P53Z or P50Z fits and send it. Waiting for year-end reconciliation gets the same money later, not more of it. For P53Z, find your P45s first.
2. If the State Pension correction is your only exposure, do nothing. No claim is needed, the average is about £6, and it should arrive as a coding adjustment, a Self Assessment credit or a payable order.
3. Check the four-year clock. 2022-23 closes on 5 April 2027; anything before 2020-21 means asking HMRC directly, with evidence.
4. Read any P800 or Simple Assessment letter against your own figures. You have 60 days to challenge a Simple Assessment.
5. Nobody needs your bank details for the State Pension correction. The payment that does ask for them, the low earner’s pension payment, is collected through your own personal tax account or by phoning HMRC — not by replying to a text or link.

The single number worth carrying away is not £33.45 and not £6. It is £3,992.52 — the average that arrives only when somebody fills in a form.