Inheritance Tax on Pensions is changing April 2027

You're taxed when you earn it, you're taxed when you spend it, and your Estate is taxed when you pass away - and it's only going to get worse...

The government want your hard earned money, more than ever! And not just whilst you're alive!

Pension funds are being brought into your estate for Inheritance Tax (IHT) from 6/4/2027.

This is a HUGE change, which is going to drastically impact the passing of wealth down to your family members.

This change is going to add a further level of complexity to retirement planning. The little known approach of investing in commercial property via SIPP pension funds, which was a great angle for business owners, will not be as attractive as it once was. Personally, commercial property investment was my long term plan for retirement and I will now need to revisit the drawing board to weigh up the impact this change is going to have.

Of the estimated 213,000 estates with inherited pension wealth in 2027/28, it's expected that:

• an additional 10,500 estates will have an IHT liability where previously they would not

• 38,500 estates will have an increased IHT bill

There's one positive change coming though;

• Death in service benefits will be excluded from the IHT Regime, including removing existing arrangements that are caught in IHT (as some are already excluded)

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Disclaimer: This post is for educational purposes, you must not take action from the information herewith without first seeking advice from your professional advisor(s).