Harriet Betteridge writes for IFA Magazine on the inheritance tax treatment of pensions

In the UK, from April 2026, pensions will fall under the inheritance tax (IHT) regime in one of the biggest estate planning shifts in years.

In an article for IFA Magazine, Harriet Betteridge, Private Client Partner, explains what this means for advisers, executors, and clients.

For many years, drawing on taxable assets first and leaving pensions untouched has been a common practice. With pensions entering the IHT net, that advice will need to change.

Clients may need to consider drawing down pension savings earlier, adjusting nomination forms, or exploring whether leaving pensions to executors could simplify administration,  though this won’t always align with family wishes and may have other downsides.

There may also be renewed interest in transferring assets out of pensions into structures that qualify for BPR or APR, though practical and valuation issues will limit the appeal for many. Lifetime gifting from pensions is another area to watch. HMRC is increasingly wary of individuals withdrawing large sums to make gifts, and tighter rules may yet emerge.

Advisers should act now by reviewing estate plans, especially where pensions form a large share of wealth, and modelling potential IHT liabilities to highlight pressures on executors. They should also discuss executor choices, ensure death benefit nominations are up to date, and explore liquidity options to cover tax efficiently. Finally, advisers must stay alert to Budget changes, including possible restrictions on pension drawdown and gifting, which could affect planning strategies.

Pensions are no longer the untouchable safe harbour in estate planning they once were. For advisers, this is a moment to demonstrate real value: helping clients navigate complexity, avoid pitfalls, and reshape their planning strategies for a new era of IHT.

Read the full piece in IFA Magazine here.