Work, income and tax – comparing the pensioner population to those of working age

How do different age groups vary in terms of income, tax paid and work?

Income and tax

Using HMRC data it is possible to estimate the amounts of income and tax by age group.  The figures suggest that those of working age account for 84% of total income and 89.1% of tax paid. Those aged 65 plus accounted for 16% of total income and 10.9% of tax paid.

 

Work

The 2021 census gives a breakdown of peoples economic status by age group. 

 

In England and Wales there were 27.77 million people employed (including full-time students in employment).  95.7% of these were of working age (16-64), while 4.3% were aged 65 plus (the old pension age).  This means that there were 1.18 million in work aged 65 or more. 

 

The figures for Cornwall showed a higher share of those employed aged 65 or more at 6.2%.

 

 Notes

Income and tax

The breakdown of income is restricted to profit, employment and pension income. Separate figures for property, interest, dividend and other income are not given because, as explained in the Notes to the Table 3.7, large amounts of these sources of income are imputed for the Survey of Personal Incomes. Estimates have been made for the United Kingdom in Tables 3.1 to 3.10 but the methods used are not sufficiently reliable to give distributions for the regions. It should not be assumed, therefore, that an estimate of the distribution of property, interest, dividend and other income obtained by subtracting profit, employment and pension income from total income in a region would be reliable.

 

Tax is income tax therefore National Insurance and VAT are excluded.

  

Sources

HMRC, (12 March 2025), Distribution of Median and mean income and tax, by age range and sex, tax year 2022 to 2023.

 

ONS, Census 2021, Table RM 024.