State Pension age changes: what employers need to do now

15 May 2026 | posted in Payroll

The UK State Pension age is increasing to 67

The State Pension age is increasing from 66 to 67 for both men and women. The change is being introduced gradually over a two-year period, starting from 6 April 2026.

As a result, anyone born between 6 April 1960 and 5 March 1961 will reach their State Pension age at 66, plus a number of additional months, depending on their exact date of birth.

Employers and employees can confirm individual State Pension age using the official calculator on GOV.UK  (The State Pension age is the earliest someone can start to receive their State Pension.)

State Pension age changes: what employers need to do now

Employers need to take steps now to ensure they are compliant with the changes to UK State Pension age.

Update payroll processes

Employees stop paying National Insurance contributions once they reach State Pension age. However, employers must continue to pay secondary Class 1 contributions.

To manage this correctly:

• Identify any employees approaching State Pension age
• Update your payroll records promptly when they reach that age
• Change the National Insurance category letter to ‘C’ in payroll systems (this needs to be in place from the first payment date after the employee reaches State Pension age).

Year-to-date information should continue to be reported under the original National Insurance category until the end of the tax year.

Verify employee documentation

Employers need proof showing that the employee has reached State Pension age before making any adjustments to the payroll.

Acceptable forms of evidence include:

• Birth certificate
• Passport
• Certificate of Age Exception (form CA4140)

Although CA4140 certificates are no longer issued, some employees may still hold them.

Communicate clearly with employees

Employees who begin claiming their State Pension, rather than deferring it, will usually have an updated tax code.

This is because though State Pension is taxable, the tax is not currently deducted at source and the coding needs to be adjusted to reflect the new source of income.

Providing early explanations can help employees understand these changes, manage their expectations and reduce queries.

Further help and guidance with payroll

If Moore already run your payroll, we will make sure you’re fully compliant with the rules during the transition period.’

For further advice, please get in touch with one of our payroll experts today. Email at east.midlands@mooreuk.global, fill in our contact us form or call one of our offices:

• Corby payroll advice: 01536 461900
• Peterborough payroll advice: 01733 397300
• Northampton payroll advice: 01604 654254