Delays in estate planning could cost families in the top decile of UK wealth an estimated £12.3 billion in preventable inheritance tax (IHT) when unused pensions enter the regime next year, according to a new report.
The research, commissioned by Octopus Investments, reveals the scale of the inheritance tax challenge facing UK families as frozen allowances, rising asset values and incoming pension changes pull more wealth into the tax net.
Affluent families who begin estate planning at 50 and make use of multiple available strategies, including exemptions, reliefs and business relief investments, could pass an average £397,000 more to their loved ones than those who begin at 70, the research found.
Across the UK, that totals an estimated £12.3 billion under post-April 2027 rules. Even under current rules, the same shift in timing would help those families pass on £258,000 more on average, or £7.9 billion in total.
The report – 50nomics: the evidence behind earlier estate planning – is based on independent economic modelling by the Centre for Economics and Business Research, alongside Opinium research with 200 UK financial advisers and 2,000 UK adults.
Advisers said they expect more than half of their client base to need estate planning support over the next five years because of the pension changes. Combined with frozen nil-rate bands, which are held until at least 2030/31 and two decades of asset price growth, the result is a tax that increasingly catches families who never expected to pay it, Octopus Investments said.
HMRC inheritance tax receipts were £7.7 billion in 2025/26 and are forecast by the Office for Budget Responsibility to rise to £14.5 billion by 2030/31. Nine in 10 UK postcodes now contain more IHT-liable estates than they did five years ago.
The research uncovers what Octupus Investments labels “a striking disconnect” between when people believe estate planning should begin and when it actually does.
Respondents said that, on average, planning should start at 44.6 years of age, with advisers reporting their typical client engages at 61. In the most exposed cohort – those aged 45 to 49 – 86% have done no estate planning at all. Among those in their 50s, the figure is 70%.
Kristy Barr, head of retail investments at Octopus Investments, said: “The biggest threat to a family’s legacy isn’t tax – it’s the conversation that gets postponed. Most of the wealth lost to inheritance tax isn’t lost to bad planning. It’s lost to no planning, by families who genuinely meant to get round to it or people who simply didn’t realise they had an inheritance tax problem.
“Our research indicated the difference between affluent families starting their planning at 50 and starting at 70 is, on average, nearly £400,000. Multiplied across the country, that is billions of pounds in legacies left on the table. For most families, the decision to wait feels like the safer one. 50nomics puts a price on that quiet decision — and a value, for those who act, on starting the conversation sooner.”
The research also highlights the emotional and practical cost of delay. Almost seven in 10 advisers said they have witnessed avoidable tax or family conflict because estate planning began too late, with reasons given by clients including they believe they are too young to start planning, feel apathetic, lack urgency, or find conversations about death and legacy difficult.
“For years, many families were told to touch pensions last,” Barr said. “That assumption must change. April 2027 will be remembered as the moment the inheritance tax conversation moved from late-life admin to mid-life essential. For advisers, this is a clear call to lead the conversation. The value of advice here is not just tax saved. It is family confidence, fewer difficult surprises, and plans that have enough time to work.
“The research also points to a growing opportunity for advisers to build relationships across generations. With only 55% of advisers implementing intergenerational strategies to retain assets across different generations, those that do can help families keep more of what they’ve built, and help their own firms to build relationships that last beyond the initial wealth transfer.”
The report also identifies “a generational issue inside the advice profession itself”, Octopus Investments said: 81% of advisers who handle estate planning beyond wills have been in the profession for 20 years or more. Only 5% have between six and 10 years’ experience, which suggests a potential shortage of specialists in the near future.
Client retention is a parallel concern. Only 55% of advisers said they have an intergenerational strategy for retaining assets when clients die – but 81% of inheritors said they plan to leave their parents’ adviser within one to two years of receiving an inheritance.
50nomics: The evidence behind earlier estate planning was commissioned by Octopus Investments and produced independently by the Centre for Economics and Business Research (Cebr) in March 2026. The economic modelling combines data from the ONS Wealth and Assets Survey, HMRC inheritance tax statistics, Cebr’s proprietary macroeconomic forecasts, and a bespoke
