Advisers are taking steps to prepare clients for the inclusion of pensions in inheritance tax (IHT) calculations from April 2027, as nearly six in 10 advisers (57 per cent) say their clients remain uncertain about the changes, according to the Scottish Widows Investor Confidence Barometer.

The research found that over half of the respondents (55 per cent) said they are recommending lifetime gifting strategies, and just under half (49 per cent) are suggesting earlier drawdown.

Meanwhile, a third (32 per cent) are recommending alternative tax-efficient wrappers such as ISAs, while 37 per cent are advising the use of trusts or onshore bonds, and nearly a fifth (18 per cent) have suggested the use of family investment companies.

Last month, the Treasury responded to the House of Lords’ report on bringing unused pensions into the scope of IHT, accepting some recommendations while dismissing others.

The forthcoming changes are prompting activity across the pensions sector. Research from the wealth management firm Lubbock Fine has shown that the number of people accessing their pension savings at the earliest opportunity has hit a five-year high, driven in part by concerns over forthcoming inheritance tax changes.

Scottish Widows intermediary wealth director, Jenny Davidson commented: “Pensions have long been a cornerstone of estate planning, offering a highly tax-efficient way to accumulate and pass on wealth.

"Next year's shake-up represents perhaps the biggest change we’ve seen to pensions since pension freedoms, but one that advisers are already getting well ahead of, according to our research.

“Any sizable landscape shift like this offers advisers an opportunity to demonstrate their value and engage with wealthier clients. Those advisers who act early and help guide clients through this process will reap the long-term benefits of closer relationships and greater trust.”

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