Overview
- The government has scheduled unspent pension pots to enter the inheritance tax (IHT) net from April 2027, creating a clear deadline for estate planning.
- HMRC data and industry reports show a surge in pension withdrawals and lifetime gifts that advisers link to the impending IHT change.
- Financial planners are pointing clients to existing IHT‑free routes such as the £3,000 annual gift allowance, the lesser‑known £250 small‑gift rule, surplus‑income gifts and the seven‑year rule.
- Advisers stress meticulous record‑keeping, including using HMRC guidance (form IHT403), because executors must report lifetime gifts when assessing an estate’s IHT liability.
- Surveys of wealthier older homeowners show many prefer to give early inheritances to help family with costs like house purchases, but fears of running out of money or facing care costs still limit some gifting.