Level<\/a>, explains.<\/p>\n\u201cFrom April 2027, the rules around pensions and inheritance tax will change significantly, as most unused pension funds will be included in the value of an estate for inheritance tax purposes, removing a previous exemption,\u201d he says. \u201cThis shift will particularly impact individuals on defined benefit schemes, though it\u2019s less of a concern for those on defined contribution pensions.<\/p>\n
White continues with the broader tax implications of this change, particularly where \u2018fiscal drag\u2019 \u2013 the phenomenon by which frozen tax thresholds pull more people into the tax system via wage inflation \u2013 is concerned.<\/p>\n
\u201cGiven current property prices and fiscal drag, we at Level estimate that around one million UK properties currently just below the inheritance tax threshold could become liable due to these changes. As property is often the main asset in an estate, this will bring many estates into the scope of inheritance tax for the first time.<\/p>\n
\u201cIt\u2019s clear from HMRC\u2019s consultation notes that this change is designed to prevent pensions from being used as a tax-planning tool rather than a means of providing for retirement. Executors and beneficiaries need to be aware of the potential tax implications and plan accordingly.\u201d<\/p>\n
It\u2019s important to be abreast of upcoming changes and how they will impact upon your situation.<\/p>\n
If you\u2019re ever in doubt or need further guidance, it\u2019s never too late to get in touch with a financial adviser or pensions expert to assist with understanding your own circumstances, your options, and how you can pass on your pension when the time comes.<\/p>\n<\/div>\n
\n
Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Sign up to our free money newsletter for investment analysis and expert advice to help you build wealth Sign up to our free money email for help building your wealth Sign up to our free money email for help building your wealth When it comes to managing pensions, the focus is generally on how much […]<\/p>\n","protected":false},"author":2,"featured_media":234339,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"tdm_status":"","tdm_grid_status":"","footnotes":""},"categories":[6],"tags":[],"class_list":{"0":"post-234338","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy"},"yoast_head":"\n
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