For information only. This is not personal financial advice. Tax rules can change and the impact of taxation depends on your circumstances and where you live.
Pensions have traditionally been treated separately from a person’s ‘estate’ for inheritance tax (IHT). This has meant pension savings could be passed on to loved ones without IHT being charged.
From 6 April 2027, however, this is set to change. Most unused pension savings will be included as part of your estate – alongside your house, other property, investments and valuables. This could affect families who haven’t previously had to consider IHT planning.
You can, of course, still pass things on from your estate – including your pension – to a spouse, civil partner or charity, without paying inheritance tax, as is the case today.
In this video, Les Cameron, Head of Technical at M&G, explains what’s changing, highlights some key exceptions, and outlines why it could be important if you’re planning to pass money on to your loved ones.
If you have any questions or would like to understand how this could affect you, and what you can do, we recommend speaking to a financial adviser.
