If you're approaching retirement or thinking about how to pass on your wealth to loved ones, there's one area of financial planning that shouldn't be overlooked: your estate.

With the government's recent confirmation that pensions will be subject to inheritance tax (IHT) from April 2027, significantly impacting the way families manage and pass on their assets, it's crucial to review estate planning now.

Leamington-based Simpson Financial Services explains what you can do to prepare for these changes.

What's changing with Inheritance Tax and pensions? 

For many years, pensions have been considered one of the most tax-efficient ways to transfer wealth. In most cases, unused pension funds passed to beneficiaries on death were exempt from inheritance tax. 

However, starting 6 April 2027, the government plans to change that. Under the new rules: 

• Unused defined contribution pension pots will be included in the estate for IHT purposes 
• If your estate exceeds the IHT threshold (currently £325,000), beneficiaries could face a 40% tax charge on anything over the threshold – including pension funds 
• Additionally, if the person who inherits the pension draws income from it, they may also pay income tax on withdrawals 

This means that some beneficiaries may face a double tax burden—potentially leaving them with far less than expected. 

Why is this important? 

Leamington Spa is home to a growing number of people with substantial pensions, rising property values, and long-term savings. Even if you don't consider yourself "wealthy" you may find that your estate could now fall into the inheritance tax net. 

Frozen tax thresholds, combined with rising asset values, mean more families are at risk of an IHT liability, even if you haven't actively planned for it. 

If your assets include: 

• One or more private pensions 
• A family home (or investment property) 
• Savings or ISAs 
• Business interests or inherited wealth 

… then this change could have real implications for your estate and how much of it your loved ones receive. 

Why independent financial advice is so important:

Working with an independent financial adviser in Leamington Spa ensures you receive unbiased, regulated guidance tailored to your circumstances.  

Here's how SFS's local, professional advice can help: 

✅ Understand your full financial position 

SFS's experienced advisers can help you assess your pension value, property, savings, and other assets to give you a clear picture of your estate's IHT exposure—especially considering the 2027 pension changes.

✅ Plan withdrawals strategically 

Should you be drawing from your pension now to reduce its value before 2027? Or should you rely on other assets first? SFS can model different scenarios based on your goals and tax position. 

✅ Make use of tax reliefs and allowances 

SFS can help you use exemptions such as the annual gift allowance, the residence nil-rate band, and spousal transfers. Simpson Financial Services can help you explore tools like trusts, business relief, or life insurance to help cover future IHT liabilities. 

✅ Coordinate wills, pensions and estate documents 

Pension death nominations, wills, and trusts should all be reviewed in tandem. As local advisers, SFS can work alongside a solicitor or accountant to make sure everything is up to date and tax-efficient. 

✅ Provide ongoing support as the law evolves 

Tax rules don't stand still. SFS monitor policy changes and offers proactive reviews so you are not caught out by new legislation or missed opportunities. 

What to expect from an estate planning review 

Simpson Financial Services (SFS) offers a free, no-obligation engagement meeting to help you get started. This is a brief, practical conversation about your goals and whether the team can assist you in achieving them. A much more detailed discovery meeting with the SFS team will be held to: 

• Map out assets and liabilities 
• Review pension and estate structure 
• Estimate future IHT liability 
• Discuss available planning strategies 
• Suggest next steps 

Whether you're preparing to retire, writing a will, or simply seeking clarity about your financial future, this meeting can serve as a helpful starting point.

Get started with estate planning today 

Estate planning is about more than just tax—it's about ensuring your wealth ends up in the right hands, with minimal stress or cost. With the upcoming inheritance tax change on pensions, it's essential to review plans well in advance. 

If you are looking for independent financial advice in Leamington Spa, Simpson Financial Services is here to help. The team works with clients across Warwickshire to provide clear, reliable, and personal guidance. 

Book a free engagement meeting

Ready to take the first step? Contact Simpson Financial Services to arrange a free initial meeting. 

Please note, the value of investments can go down as well as up, and you may get back less than the amount invested.

To learn more about Simpson Financial Services Ltd and enquire about its services, call 0800 634 211 or email [email protected].

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