retirement pension

[jannyneve]

i am due to retire in july,i currently work part time,i am a widow,i have been asked by my employer if i would like to work a few hours a week after my retirement,how will this affect my state pension,and how much am i allowed to earn before paying tax?p.s.i recieve a very small private pension from my husband.

[Loosehead]

The amount you get for the state pension is unaffected by working. The total income that you have including earnings, state pensions, other pensions, investement etc will then be subject to tax if the total is above the threshold - allowances. The pensioners threshold is 7090 and it goes up when you reach 75. That means that you will pay tax on all amounts over 7090.

[duckygirl]

It will depend howold you are.. I am presuming you are 60 - if so you will not receive the higher Personal Allowance of 7090 until you are 65. You are allowed to receive �4895 from all sources of income for 2005-6 without paying tax. The way it will work for  you is that the state pension you receive will be deducted from your Personal allowance-what is left will be allocated against your small private pension - if anything is left after all that has been taken off you will have some tax free allowances against your few hours a week with your employer. Depending on your total income you will either pay 10% or 22% of the wages you receive