On 18 May 2026, HMRC published draft regulations relating to the changes to Inheritance Tax (IHT) treatment for pensions.
Published: 02 June 2026
Authors: Rhiannon Barnsley-Bloomfield
What is changing?
Under the Finance Act 2026, most unused pension funds and death benefits will, from 6 April 2027, be included in the value of a person’s estate when determining IHT liability and thresholds.
An “unused” pension is one which has not been used to claim an income. For money purchase arrangements, this will include all money held in a pension savings pot. For defined benefit arrangements, this will include lump sum death benefits that do not fall within any of the exclusions.
Personal representatives, who already report and pay IHT on a deceased person’s estate, will be responsible for reporting and paying any IHT due on unused pension funds and death benefits.
What are the new draft regulations?
The draft regulations have been published by HMRC for technical consultation. The regulations make changes to the Registered Pension Schemes (Provision of Information) Regulations 2006 to incorporate the changes made by the Finance Act 2026. The consultation closes at 11:59pm on 11 June 2026.
The draft regulations focus on the information-sharing that will be required between pension providers and personal representatives, and with pension beneficiaries and HMRC, in order to facilitate the payment of IHT on unused pension funds.
This follows the publication on 11 May 2026 of a technical note by HMRC.
What are the key provisions?
Pension scheme administrators and personal representatives are already required to share information about the deceased and beneficiaries after a member has died. The new regulations build upon this. The key provisions under the draft regulations are:
- the scheme administrator (or the insurance company, if relevant) will be required to provide initial information to the personal representatives of a deceased member of the scheme within 28 days of receiving the request. Initial information will include the value of the notional pension property other than excluded benefits, at the date of the member's death,
- if the value of the notional pension property is an estimate, the actual value must be provided within 14 days beginning with the day on which the actual value is obtained by the scheme administrator
- further information must be provided to a personal representative where they are required to file an IHT account and request further information from the scheme administrator
- if a personal representative, or prospective personal representative, gives a withholding notice to a scheme administrator the administrator must: (i) confirm receipt of the notice and (ii) confirm whether it accepts the notice is a valid withholding notice or why it is considered to be invalid within 14 days beginning with the date the notice is received, and
- if a scheme administrator accepts a notice as a valid withholding notice, the scheme administrator must inform the beneficiaries of (i) the date of the notice and (ii) the details of the person who gave the notice.
What is next?
HMRC intends to make and lay the regulations in spring/summer 2026.
HMRC has confirmed that it is planning to publish guidance and other supporting materials before 6 April 2027, including templates to use for withholding and paying IHT and interactive tools for personal representatives. It has also confirmed it is planning to update its tax manuals with detailed guidance on IHT and pensions.
Key takeaways
The regulations are still in draft and subject to consultation, so they could change. Scheme administrators in particular should keep an eye on developments and ensure the necessary systems are in place to comply with the information-sharing requirements from 6 April 2027.