IHT on pensions: New thinking on taking income in retirement?

‘This has undoubtedly had a huge impact on planning for many clients’

clock • 3 min read

Lisa Webster looks at upcoming IHT on unused pension funds and says the need for personal advice is stronger than ever

Since pension freedoms came into effect back in April 2015 the thinking has been that defined contribution pensions are the last assets clients should use to provide income in retirement. Rather, use unwrapped, taxable assets first, then ISAs and pensions once the rest has gone (except for taking tax-free cash by age 75). With unused pensions outside the estate when the client dies, this was a logical approach for most. Fast forward to Budget 2024, and this logic has been turned on its head. For deaths from 6 April 2027 pension death benefits will be included when calculating inher...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

Triple lock played 'important role' but it would 'always need to end'

Triple lock played 'important role' but it would 'always need to end'

Pensions industry reacts to triple lock change

Holly Roach
clock 30 September 2026 • 4 min read
Triple lock changes welcome but 'cannot solve' national care problem

Triple lock changes welcome but 'cannot solve' national care problem

‘The sooner the government comes clean on these plans the better’

Sophia Panayi
clock 30 September 2026 • 6 min read
'The interesting thing about Burnham's triple-lock plan isn't the triple lock'

'The interesting thing about Burnham's triple-lock plan isn't the triple lock'

'Look past the mechanism and something more interesting is happening'

Tony Müdd
clock 30 September 2026 • 5 min read