Tax on pensions

[Hendy]

I am a 60 year old male who retired at the age of 57. I have an indexed linked final salary pension currently paying �33000 per annum. I checked my state pension entitlement and can confirm that I will receive the full amount at NRD. A friend is insisting that I will lose 50% of my state pension as a result of inland revenue requirements. Is this true? Surely I will only pay the standard rate of income tax applicable at the time. (some possibly in the 40% bracket)

Mr D Hendy 

[Loosehead]

Your friend is wrong.You will get a state pension based on your NI contributions throughout your working life. Other income is irrelevant to that. The state pension will though be added in with all your other forms of income for taxation purposes.

[Loosehead]

Possibly your friend is refferring to what tax you are likely to pay. But the most that will be is 40% and very little at that rate, mostly it will be 22%