Pension gifting

Ian Boasman Kellands

Ian Boasman of Kellands discusses the continued importance of gifting allowances.

The latest January edition of Moneyfacts features an article by Ian Boasman APFS, Chartered Financial Planner of Kellands.

In it, Ian looks at how the recent Budget has caused quite a stir with the announcement that pensions could potentially be brought into the Inheritance Tax (IHT) calculation. This means that the playing field for IHT planning will become even narrower.

The current plan is that from April 2027, pensions will form part of an individual’s estate and incur IHT at 40% should that individual (or couple) exceed their nil rate bands (£325,000 each) and main residency nil rate bands (up to £175,000 each) for 2024/25.

If that pensioner also dies after age 75, additional income tax at the recipient’s marginal rate will also be incurred when they draw funds.

Up until now, pensions have been one of the key tools to help ensure assets are passed on efficiently to loved ones but with the potential heavier taxation that will now be incurred on death, it’s important to consider how to mitigate this problem early on.

This is addressed in Ian’s article, which you can read or download by clicking on the link below.

If you would like to discuss your estate planning options in the light of the recent Budget, please do not hesitate to contact us.

Download Moneyfacts pension gifting article

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