Marvin OnumonuOne in five (19%) high-net-worth individuals (HNWIs) aged 55 and over did not know about changes to inheritance tax (IHT) rules on pensions coming in April 2027, research from Charles Stanley found.
From 6th April 2027, unused private pensions will be included in an individual’s estate for IHT, which could mean more estates will be liable.
Over half (51%) said they had only heard about the changes but did not know what they meant.
25% of those who knew about the rules said they were not taking any action ahead of the changes.
13% had not done anything yet but said they planned to, and 8% did not know what they could do.
15% said they were spending from their pension to reduce IHT liability, while 14% were focusing on other tax-efficient savings such as ISAs.
13% had changed their financial plans, and another 13% had taken professional advice.
Data showed that 32% said they felt disappointed, 23% felt frustrated, and 20% felt disillusioned.
Only 10% said they felt confident, 8% felt prepared and another 8% said they were unbothered.
Harry Bell, director financial planning at Charles Stanley, said: “Pensions are among the most valuable assets people hold, yet many remain unaware of how upcoming reforms could affect their estate planning.
“From April 2027, unused pension pots will fall within the scope of inheritance tax, which could significantly increase liabilities for families.
“While there’s no need for knee-jerk reactions, understanding the implications and planning ahead is essential.”
Bell added: “These changes alter long-standing assumptions about retirement planning, so taking advice now is crucial to avoid unexpected tax bills and ensure your wealth supports both your income needs and your legacy.”
