Maximum Inheritance Urges UK Families to Act as Pensions Enter the Inheritance Tax Net from April 2027

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Ade Oduyemi
Maximum Inheritance, established in 1999 and led by inheritance tax specialist Ade Oduyemi, is urging UK families and executors to review their arrangements ahead of 6 April 2027, when most unused pension funds and pension death benefits are brought within the value of a deceased person's estate for inheritance tax purposes.
Maximum Inheritance, a UK estate planning firm operating since 1999, is calling on families across the United Kingdom to review how their pensions sit within their wider estate before 6 April 2027, when most unused pension funds and pension death benefits are brought within the value of a deceased person's estate for inheritance tax purposes.

The change is already law. It was written into the Finance Act 2026, which received Royal Assent on 18 March 2026, and it applies to deaths on or after 6 April 2027. Where a pension scheme member dies before that date, the current rules continue to apply even if the benefits are paid to beneficiaries afterwards.

The government has published its own estimate of how far the change reaches. Of around 213,000 estates with inheritable pension wealth in 2027 to 2028, HMRC expects 10,500 to face an inheritance tax liability where previously they would have had none, and approximately 38,500 to pay more than they would have under the old rules. The average liability is expected to rise by around 34,000 where pension assets are brought into the value of the estate.

HMRC is equally clear that most estates will continue to have no inheritance tax liability at all after 6 April 2027, and that its estimates are static, taking no account of behavioural changes such as tax planning or drawing pension funds down faster. On that basis the figures describe a maximum rather than a forecast.

"A great many families have been told, quite correctly under the old rules, that their pension was the efficient thing to pass on," said Ade Oduyemi, estate planning and inheritance tax specialist at Maximum Inheritance. "The rule that made it efficient is being removed. What worries me is how many people have a plan built on that assumption and no idea it has changed. The date is fixed and it is in the statute book, so there is no benefit in waiting to see what happens."

Until now, unused pension funds have sat outside the estate for inheritance tax. Many families built their plans around exactly that feature, drawing on other assets during retirement and leaving the pension untouched so it could pass to the next generation intact. From April 2027, that approach no longer produces the result it once did.

The change also lands squarely on executors. HMRC's technical note on inheritance tax and pensions, updated on 29 May 2026, sets out obligations that reshape how estates are administered.

Under the new framework, pension scheme administrators will need to share information and respond to notices before the grant of probate is issued, reversing the current practice where a scheme typically asks to see the grant first. Where a personal representative requests a valuation, the scheme must provide the open market value at the date of death, and if it cannot do so within 28 days of the request, it must provide an estimated value together with the basis for that estimate.

HMRC is also introducing two instruments that executors will need to understand. A withholding notice allows a personal representative to stop a scheme distributing death benefits while the inheritance tax position is settled. A payment notice allows the inheritance tax due on the pension to be paid by the scheme directly to HMRC, rather than falling to the personal representative to fund.

"Executors are the ones who will feel this first," Oduyemi added. "You are dealing with a bereavement, and now you also have valuation deadlines, notices to issue, and a pension provider to chase before you even hold the grant. Families who sort out the structure in advance spare their executors a great deal of that."

Certain protections remain in place. Transfers between spouses and civil partners continue to be exempt from inheritance tax where the recipient is a long-term UK resident. Estates leaving at least 10% of the net estate to a UK charity continue to be taxed at the reduced rate of 36% rather than 40%, and charity lump sum death benefits paid from a pension count towards that threshold.

Maximum Inheritance works with clients to assess exposure under the new rules, review how pension death benefits are nominated and structured, and coordinate pension planning with the rest of the estate. For many families this means revisiting expression of wish forms, reconsidering the order in which assets are drawn during retirement, and examining whether lifetime gifting, trusts, or life insurance arrangements have a role.

HMRC has committed to publishing detailed guidance and supporting materials, including interactive tools for personal representatives, by April 2027. That guidance is aimed at executors administering estates after the change takes effect. Families who want to alter how their pension sits within their estate have until then to do it.

Maximum Inheritance provides bespoke estate planning [https://www.max-inheritance.co.uk/estate-planning/], inheritance tax planning [https://www.max-inheritance.co.uk/inheritance-tax-planning/], and probate assistance services to clients across England and Wales, drawing on more than 25 years of experience helping families protect wealth through changes in UK inheritance tax legislation.

Families who wish to understand how the April 2027 pension changes affect their estate can arrange a consultation at a time that suits them by visiting www.max-inheritance.co.uk [https://www.max-inheritance.co.uk/contact/].

About Maximum Inheritance

Maximum Inheritance, established in 1999, is a UK-based estate planning firm specialising in estate planning, inheritance tax planning, and probate assistance. Led by inheritance tax specialist Ade Oduyemi, the firm helps families protect assets, minimise tax exposure, and preserve wealth for future generations.

Media Contact

Name: Ade Oduyemi

Email: ade@max-inheritance.co.uk [mailto:ade@max-inheritance.co.uk]

Company: Maximum Inheritance

Phone: 020 8669 1779

Address: 18 Salisbury House, 8 Melbourne Road, Wallington SM6 8SA, United Kingdom

Website: max-inheritance.co.uk [https://www.max-inheritance.co.uk/]

Media Contact
Company Name: Maximum Inheritance
Contact Person: Ade Oduyemi
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Phone: 02086691779
Address:18, Salisbury House 8 Melbourne Road Wallington SM6 8SA United Kingdom
City: Wallington
State: Greater London
Country: United Kingdom
Website: https://www.max-inheritance.co.uk

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