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Surprise HMRC bills as pension rises hit Personal Allowance

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The issue comes down to the frozen personal allowance, which remains stuck at £12,570. As the state pension increases each year, it takes up more of that tax free limit.

That leaves less room for any extra income. Even a small private pension or part time earnings could now push some retirees over the threshold and into paying tax for the first time.

Experts warn this “stealth tax” effect is catching more people than expected, as rising incomes collide with frozen thresholds.

Tim Grimsditch, Managing Director at Unbiased, said the increase in the state pension is creating a problem for many people.

“For millions of retirees, the latest increase in the state pension is a double-edged sword.

“While the ‘triple lock’ is doing its job by protecting the value of pensions against inflation, the government’s decision to keep the personal tax allowance frozen at £12,570 is creating a ‘stealth tax’ trap.

“As the state pension rises to meet the cost of living, it is consuming more and more of that tax-free buffer. For many, this means that even a modest private pension or a small amount of part-time work could now result in an unexpected tax bill.

“If you’re unsure, seek help from a professional financial adviser who can help clarify your position, reduce uncertainty, and plan with greater confidence.”

At the same time, savers and workers are being warned they could miss out on up to £1,500 by not using key tax-free allowances before the deadline.

Here are four allowances to check now.

ISA allowance

You can save up to £20,000 per year in an ISA without paying tax on interest, dividends or capital gains.

  • Covers Cash ISAs, Stocks and Shares ISAs or a mix
  • Returns are completely tax free
  • Allowance resets on April 6

For example, £20,000 saved at 5 percent interest could earn £1,000 tax free.

Capital Gains Tax allowance

You can make up to £3,000 in profit from selling assets tax free.

  • Applies to shares, crypto and second properties
  • Not applicable to your main home
  • Tax applies above the threshold

Rates above the allowance are 18 percent for basic rate taxpayers and 24 percent for higher rate taxpayers.

Dividend allowance

If you own shares, you can earn up to £500 in dividends tax free each year.

  • Applies to income from investments
  • Tax rates depend on your income band
  • Allowance has been reduced significantly in recent years

Even small portfolios can exceed this limit, leading to unexpected tax.

Personal savings allowance

You can earn interest on savings tax free depending on your income.

  • Basic rate taxpayers get £1,000
  • Higher rate taxpayers get £500
  • Additional rate taxpayers get no allowance

However, rising interest rates mean more people are now exceeding these limits.

Why more people are paying tax on savings

Frozen thresholds and higher interest rates are pulling more savers into paying tax, a process known as fiscal drag.

For example, £20,000 saved at 4.58 percent earns around £916 in interest each year.

This exceeds the £500 allowance for higher rate taxpayers.

Similar savings in an ISA would be tax free.

Research shows over a third of people have never heard of the personal savings allowance, while billions have been paid in tax unnecessarily over the past decade.


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What to do before April 5

With the tax year ending soon, acting now could protect your savings and reduce your tax bill.

  1. Use your full ISA allowance before it resets
  2. Review savings and investments for unused allowances
  3. Consider moving savings into tax efficient accounts
  4. Check if rising income could push you into paying more tax

Financial experts say taking action now can help avoid unexpected bills and make your money work harder.





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Oxford News

Jeremy Clarkson issues heart breaking cancer update

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The 66-year-old broadcaster and journalist made the announcement during the final two episodes of the fifth series of Clarkson’s Farm, released on Wednesday.

He shared the news with co-stars Kaleb Cooper and Charlie Ireland during a conversation at his Diddly Squat Farm in Oxfordshire.

Mr Clarkson said: “I’ve got cancer.”



When Mr Cooper asked where the cancer was located, Mr Clarkson replied: “Where it is, is of no concern to anybody.

“I’ve known since May.”

He explained that the cancer was detected early following a medical in May and described it as “aggressive”.

Mr Clarkson said: “I was praying we could get the harvest done and then I could go and get some treatment, but it’s going to be slap bang in the middle.”

Later in the episode, he revealed he had surgery to remove 10 per cent of his prostate.

He also reflected on what has been a difficult year for his health, including a serious heart issue that required the fitting of two stents.



He said: “So we started the year and I had coronary heart disease and ended it with me with cancer.”

The series ends with footage of Mr Clarkson in a hospital bed as he undergoes treatment.

He told viewers: “Some of the treatment has gone awry, let’s say.

“I’m going to be here for a little while.

“I’m nil by mouth, I don’t know what’s going to happen.


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“What I wanted to say was if this is all successful, I’ll see you for season six, and if it isn’t, I won’t.

“Take care, everyone.”

Despite his diagnosis, Mr Clarkson continued working throughout 2025.

Production on the sixth series of Clarkson’s Farm is now expected to pause to allow time for his recovery.

What do you think of the latest Clarkson’s Farm series? Let us know in the comments





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New Oxford pubs and bars app shows live pub deals and offers

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Charlbury-based Richard Coffey launched Bar Trender around six weeks ago to help businesses facing damage, and ultimately closure, from rising costs and economic uncertainty.

Richard Coffey started the venture which has been accepted by a plethora of Oxford pubs and bars (Image: Richard Coffey)

In the city, 22 venues have signed up, including pubs in hotspots such as Cowley Road and Jericho.

The venture was seeded while travelling in Australia. There, he noticed Sydney and Melbourne’s bar scenes were built around happy hours, a culture which he said didn’t really exist back in the UK.

After 10 years of hard work, after leaving a London start-up, he pursued the venture with the help of Artificial Intelligence to cut team and budget requirements.

READ MORE: Oxford MPs welcome social media ban but warn of implementation

He said: “I kept finding myself not knowing what was on, where had decent deals, or which pubs had the features I was looking for. The information existed, it just wasn’t anywhere in one place.”

The app, which provides full autonomy to the business, helps to boost their sales by providing visibility and awareness for the consumer.

Bar Trender app (Image: Bar Trender)

He says this comes at a time when people are “more conscious than ever about where they spend their money”.

He said: “The idea of being able to see what deals are near you before you decide where to go is genuinely useful right now in a way it perhaps wouldn’t have been five years ago.

“The cost of living crisis has fundamentally changed how people make decisions about going out.

“It’s not that people don’t want to go out, but they’re making more considered choices about where they spend their money.”

READ MORE: Crowds gathered for family-friendly fun day in Oxfordshire village

The venture will also support the wider hospitality sector, which is also under “enormous pressure”.

Bar Trender is proud to support Tom Kerridge’s VAT’s The Problem campaign, which is calling for a 10 per cent cut in VAT for hospitality venues.

Bar Trender app is available on app stores now (Image: Richard Coffey)

He said: “Energy costs, wage increases, food and drink inflation and the lingering effects of the pandemic have squeezed margins to the point where venues that were thriving five years ago are now struggling to survive.

“We’re seeing more pub closures than at any point in recent memory and once they are lost, are very rarely replaced.”

A launch event will take place at Plush on Friday, June 16, with free shots and drink vouchers available to anyone who has the app downloaded.

Christopher Farr, owner of the LGBTQ+ night club and bar, said the venue is committed to making clubbing safe, affordable and fun.

He said: “The partnership is the perfect way to communicate our affordable drink deals in a fun and easy to use app.”





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Oxfordshire SEND plan aims to improve support for children

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Oxfordshire County Council’s SEND reform proposals were discussed by its cabinet on Tuesday, June 16.

They include expanding inclusion in mainstream schools, boosting recruitment of educational psychologists and therapists, and creating inclusion support bases.

Sean Gaul, the council’s cabinet member for children, education and young people’s services, said: “Every child deserves an opportunity to thrive whatever their circumstances and this plan sets out how we will deliver better, more inclusive support for children and young people with SEND.

“We are working closely with partners and with families, children and young people who are at the heart of the SEND system.”

Ofsted has previously recognised recent improvements in Oxfordshire’s SEND services, including better joint commissioning and reduced waiting times.

The plan has been developed in consultation with health partners, schools, and the Oxfordshire Parent Carer Forum, and focuses on early intervention, universal and targeted support, and improved outcomes.

If approved, the council will receive a high needs stability grant, potentially covering up to 90 per cent of its dedicated schools grant deficit.

Mr Gaul said: “It’s a vital step towards improving outcomes while making sure our services are sustainable for the future.”

The reform plan is part of the council’s response to national education reforms, including the ‘Every child achieving and thriving’ Schools White Paper and the ‘putting children and young people first’ SEND consultation.

Councils must submit their SEND reform plans to the Department for Education by 19 June.





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