HM Revenue and Customs has issued a technical note setting out the how pensions will be taxed as part of inheritance tax from April 2027, and the obligations placed on personal representatives administering estates.
Named executors administering estates, or instructing third parties to deal with the estate on their behalf, will meet the definition of ‘personal representative’ as defined in section 272 of the Inheritance Tax Act 1984 and in section 989 of the Income Tax Act 2007.
The note sets out the requirements placed on personal representatives within The Registered Pension Schemes (Provision of Information) (Miscellaneous Amendments) Regulations 2026, including information-sharing requirements, the initial assessment of IHT liability, and correctly completing IHT accounts and calculations.
Title, rights and liabilities as executors will be vested from the date of the deceased’s death and before any application for grant of representation is made.
Where there is no named executor, or the executor is unable or willing to act, any prospective personal representative will have no title until the grant of representation is made. HMRC is preparing further guidance to assist in evidencing a personal representative’s authority and identity.
Further consequential amendments to the Registered Pension Schemes (Splitting of Schemes) Regulations 2006 are expected ahead of the changes, along with amendments to the Inheritance Tax (Delivery of Accounts) (Excepted Estates) Regulations 2004, to ensure that estates which include notional pension property can qualify as excepted estates.
Emily Dean, technical counsel and head of government affairs at STEP, welcomed the note but warned executors will face increasing pressure following the changes.
She said: “We’re pleased that HMRC has provided further clarification on the new inheritance tax rules for pensions. The additional detail helps answer some of the questions facing executors and gives more clarity on how the new process will work in practice.
“However, STEP remains concerned that the new rules place a heavy administrative burden on executors, and could make dealing with a loved one’s estate slower, harder and more expensive.”
HMRC said it will continue to work closely with stakeholders throughout the autumn, with a further technical note covering international issues, the interaction of IHT with income tax, guidance on intestacy and clarification of matters relating to charities and trusts.
Draft guidance will be shared with industry stakeholders in autumn and winter 2026, with additional regulations to be published on split schemes and excepted estates during the same period.
From winter 2026 to spring 2027 communications activity will publicise upcoming changes to impacted groups and in spring 2027 guidance and other supporting materials will be published.
