IHT on pensions

Change is coming - and it will affect death benefits

Simon Douglas

Pension funds are generally exempt from Inheritance Tax (IHT) and have increasingly been used as tools for estate planning. Reforms to pensions in 2015 granted pension holders greater flexibility in accessing their savings. Prior to these reforms, most pensioners were required to purchase an annuity and receive a regular income in retirement. The changes allowed individuals to retain their savings in pension funds, drawing on them as needed, or leaving them untouched entirely.