Tax demands will land on pensioners' doorsteps soon (Image: Getty)
Around 140,000 pensioners will be hit by tax demands for the first time since they retired within weeks.
The taxman confirmed that older people on lower incomes will be dragged in paying bills after thresholds triggering when money must be handed over were frozen.
Tories warned there would be a “retirement tax” if Labour won because Sir Keir Starmer refused to match their triple lock plus guarantee to keep anyone relying only on state pensions out of tax.
HMRC’s demand in the next six weeks will hit those on a mix of state and private pension but at the lowest end of the income scale.
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Sir Steve Webb, partner at pension consultants LCP, said: “It is rarely good news to receive a letter from HMRC and in this case 140,000 pensioners will be getting a tax demand in the next few weeks for the first time since they retired.
“The size of the bill will often be relatively small at first, but this could grow year-on-year if the current policy of freezing tax thresholds continues.
“The recipients of these letters are not well off, and some will have a living standard below the pensions industry’s assessment of the ‘minimum’ income needed for a basic quality of life.
“There is also a risk that scammers will catch on to the fact that these letters are being sent out and come up with fake letters trying to get money out of pensioners.
“The new Government needs to take an urgent look at whether taxing so many people on such modest levels of income in retirement is really the right way to proceed.”
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The income tax threshold has been frozen at ￡12,570 since April 2021.
HMRC said it is sending out bills to 560,000 people who have taxable income but who are not in Self Assessment or PAYE, including 140,000 pensioners who will receive a “simple assessment” for the first time.
Pensioners will have until January 2025 to pay up.
Dennis Reed, director of Silver Voices said: "This crazy situation was bound to arise and will get much worse unless action is taken to unfreeze the lower tax threshold.
“Labour has stored up the problem for themselves, by opposing the Tories' 'triple lock plus' proposal to raise the tax threshold for pensioners by the triple lock increase each year, but not offering an alternative.
“Unless the new Government takes action in the autumn Budget, many more older people will find themselves subject to tax for the first time because of tiny occupational or widow's pensions; and before the end of this Parliament all pensioners will be paying tax on the basic state pension.
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“This is a ridiculous situation which will cost millions in administrative costs and enforcement procedures.
“Many older people will also be confused by the complex forms and worried that they may get fined for non-completion or mistakes. Labour must act quickly to resolve this escalating crisis.”