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Succession Changes
Updated: 17 September 2025
Succession Planning Alert: Pension Changes Create New Risks for High-Value Estates
Recent pension policy changes will have a direct impact on succession planning - yet more than half of the UK adults remain completely unaware of them. For accountants advising business owners and high-net-worth families, this lack of awareness represents both a risk and an opportunity.
Key changes every adviser should note:
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Pensions brought into IHT net from April 2027 - retirement funds will no longer automatically sit outside estates for inheritance tax purposes. For larger portfolios, this could add significant unexpected liabilities.
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Access age rising from 55 to 57 in April 2028 - creating a potential 'cliff edge' for clients planning early retirement or business exits.
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State pension age increases - rising to 67 between 2026-2028, with future reviews suggesting further increases.
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Heirs facing double taxation - where death occurs after age 75, beneficiaries could be hit with both inheritance tax and income tax, with effective rates of up to 67% for additional-rate taxpayers.
Why This Matters for Accountants
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Business Owners relying on pension pots as part of their exit strategy may need urgent restructuring.
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HNW Families who assumed pensions were tax-efficient succession tools must revisit estate planning before 2027.
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Cross-Generational Planning is now critical - particularly where children will inherit both pensions and other significant assets.
The Action Plan
Clients cannot afford to wait. These changes reduce flexibility and increase exposure to IHT, but with proactive planning - including the use of trusts, Family Investment Companies, and revised will structures - accountants can still help secure tax-efficient transitions.
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At Wills, Tax & Trusts Ltd., we work in partnership with accountants to restructure wealth, prepare families, and ensure succession plans are robust in light of changing legislation.