Pensioners warned their pot could be raided after death due to Inheritance tax rule change

Inheritance Tax rules are undergoing some major changes that could potentially leave pension pots vulnerable after death.

There is no Inheritance Tax to pay if you inherit a pension from someone who died before the age of 75, under current rules.

If the person dies after the age of 75, then you pay Income Tax when you start to take money from the inherited pension.

However, from April 2027, inherited pensions will be subject to Inheritance Tax.

This will be included in the individual's "estate", covering property, possessions, and money.

Additionally, this applies if the person died before reaching the age at which they can start accessing their pension.

This is currently set at 55 but is rising to 57 from April 2028.

A spokesperson from HMRC told Pension Age said: “We continue to i