IHT on pensions opposed by industry professionals

There’s overwhelming opposition to the proposed introduction of IHT on unused pensions, according to a new survey conducted by SSAS provider WBR Group. The firm has written to the pensions minister to urge the government to rethink their plans. Under the proposals set out in the Autumn Budget inherited pension pots will be subject to inheritance tax from April 2027. The new research was conducted in the last two weeks and highlighted concerns about the fairness and practicality of the proposals, the firm said. It revealed that 90.41% of industry professionals polled agreed or strongly agreed that the introduction of IHT on unused pensions is both retrospective and unfair. Some 97.26% agreed or strongly agreed that the proposals force pensions into an IHT regime that does not accommodate the practicalities of current pension rules or administration processes. The same amount, 97.26%, strongly agreed that trustees and providers will incur additional costs to administer the proposals, which are likely be passed on to consumers. All respondents, 100%, agreed or strongly agreed that the proposals assume the estate of a deceased pension scheme member has the timely information and liquidity to cover any IHT due. Almost all, 98.63%, agreed or strongly agreed that the proposals will act as a major disincentive for consumers to engage with pensions. In response to the findings, Southall, head of SSAS proposition at WBR has published an open letter to the pensions minister Torsten Bell, urging a reconsideration of the proposed IHT changes. The letter emphasises the industry's concerns and calls for a more thoughtful and equitable approach to pension taxation. Ms Southall said: “The proposed introduction of IHT on unused pensions is not just a concern, it is a looming disaster for the pensions industry. “These changes are not only impractical but also a grave injustice to those who have diligently and responsibly saved for their retirement. We implore the Government to reconsider these draconian proposals and collaborate with pension experts such as us to forge a more balanced and equitable solution that truly supports long-term pension savings. “The future financial security of countless individuals hangs in the balance.” The survey gathered responses from 75 industry professionals over the last two weeks and during a webinar on IHT.

IHT on pensions opposed by industry professionals

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