{"id":7685,"date":"2025-12-02T11:04:09","date_gmt":"2025-12-02T11:04:09","guid":{"rendered":"https:\/\/new.contentdeployment.co.uk\/quilter\/?p=7685"},"modified":"2025-12-02T14:21:56","modified_gmt":"2025-12-02T14:21:56","slug":"pensions-set-to-fall-within-iht-net-from-2027","status":"publish","type":"post","link":"https:\/\/new.contentdeployment.co.uk\/quilter\/2025\/12\/02\/pensions-set-to-fall-within-iht-net-from-2027\/","title":{"rendered":"Pensions set to fall within IHT net from 2027"},"content":{"rendered":"
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From April 2027, unspent defined contribution pensions will be subject to IHT liabilities <\/td>Average IHT bills could rise by \u00a334,000, with risks of double taxation reducing pension value further <\/td>Options to reduce exposure include gifting, trusts, charitable legacies and life cover written in trust <\/td><\/tr><\/tbody><\/table><\/figure>\n<\/div>\n\n
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From April 2027, unspent defined contribution pensions will become subject to IHT \u2013 a significant departure from today\u2019s rules, where pensions usually sit outside the estate.<\/strong> <\/h2>\n<\/div>\n\n
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The impact on households is likely to be far greater than official estimates suggest. Rather than only capturing the super-rich, these changes risk pulling in ordinary families where pensions and property values together push estates over the threshold. With property prices and pension wealth both rising over recent decades, many more households than expected could find themselves facing large and unexpected tax bills. <\/p>\n<\/div>\n\n

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The change also risks complicating\u00a0estate administration. Executors\u00a0will need to factor pensions into IHT\u00a0calculations for the first time, potentially\u00a0delaying the probate process and\u00a0creating new liabilities. Another\u00a0concern is the risk of double taxation.\u00a0Pensions inherited after age 75 are\u00a0already taxed as income, and from\u00a02027 could also attract IHT \u2013 meaning\u00a0beneficiaries may see more than half\u00a0of the value eroded by tax.\u00a0<\/p>\n<\/div>\n\n

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Steps to consider <\/h2>\n<\/div>\n\n
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There are currently several ways to mitigate exposure to IHT, including making use of tax-free gifts, establishing trusts, leaving charitable legacies (which can reduce the overall IHT rate to 36%), or arranging a whole-of-life insurance policy written in trust to cover liabilities. Read more on how to gift efficiently on page 12. <\/p>\n<\/div>\n\n

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This development highlights the importance of proactive estate planning. With rules changing, pensions can no longer be assumed to fall outside IHT. Reviewing arrangements now could help safeguard family wealth and ensure it is passed on as intended. And with the budget approaching, more changes may still come. <\/p>\n<\/div>\n\n

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It is important to take professional advice before making any decision relating to your personal finances. Information within this article is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored advice and is for guidance only. Some rules may vary in different parts of the UK.<\/em> <\/strong><\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"

From April 2027, unspent defined contribution pensions will be subject to IHT liabilities  Average IHT bills could rise by \u00a334,000, with risks of double taxation reducing pension value further  Options to reduce exposure include gifting, trusts, charitable legacies and life cover written in trust  From April 2027, unspent defined contribution pensions will become subject to IHT \u2013 a significant departure […]<\/p>\n","protected":false},"author":4,"featured_media":7686,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[32,77],"tags":[],"hd_content_source":[],"_links":{"self":[{"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/posts\/7685"}],"collection":[{"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/comments?post=7685"}],"version-history":[{"count":7,"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/posts\/7685\/revisions"}],"predecessor-version":[{"id":7706,"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/posts\/7685\/revisions\/7706"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/media\/7686"}],"wp:attachment":[{"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/media?parent=7685"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/categories?post=7685"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/tags?post=7685"},{"taxonomy":"hd_content_source","embeddable":true,"href":"https:\/\/new.contentdeployment.co.uk\/quilter\/wp-json\/wp\/v2\/hd_content_source?post=7685"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}