If you are inheritance tax planning in Oswestry or Chester, it is worth considering one looming change. As of April 2027, all untouched pensions will fall under inheritance tax (IHT), as levied by HMRC.
Financial advisers have noted a significant increase in the number of people requesting consultations ahead of the proposed changes, with some experts reporting a 50% rise in the number of families seeking guidance. This suggests that the government’s announcement has cut through to the public and is already having an impact.
With the changes taking effect from next spring, unused pension pots are set to become liable for inheritance tax. This has prompted many older savers to reassess how they pass down their wealth, with many seeking advice on how to mitigate what is perceived as a ‘stealth tax’.
One Belfast-based independent financial adviser, David Stirling, is one of the industry figures who has observed a shift in attitudes amongst people in their 60s and 70s. Many of these are clients who previously spent decades accruing pension savings and building wealth, assuming the money could be passed down to loved ones tax-efficiently. He said that despite an increase in public awareness, there remains an underappreciation of how much the alterations could impact finances.
The new regime may force people to reconsider their financial strategies because pensions are no longer automatically exempt from individual estates. As such, those families with substantial pension wealth could incur higher tax bills than anticipated. Stirling recommends that people in this position do not leave it too late to plan their inheritance and start thinking now about setting up trusts in accordance with the seven-year rule.
