Four in 10 people say they are worried about upcoming changes to pensions and inheritance tax.

The government intends to make unused pensions subject to inheritance tax from April 2027.

That’s a worry for 28% of people aged over 55, while almost half, 48%, of those aged 18-34 are concerned.

Some 69% of additional rate taxpayers are worried, as are 51% of those paying higher rate tax.

Around a third, 34%, of basic rate taxpayers are concerned about the potential changes, according to research from platform Hargreaves Lansdown.

Helen Morrissey, head of retirement analysis at HL, said: “The government’s plans to make unused defined contribution pensions subject to inheritance tax has thrown many people’s plans into disarray.

“The more people earn, the more concerned people are – 69% of additional rate taxpayers said they were worried while just over half of those paying higher rate said the same.”

She pointed out that the current position is that pensions are not usually subject to inheritance tax and if death occurs before age of 75 there is no income tax to pay either.

That has resulted in many people running down other assets first and leaving their pensions untouched as long as possible, so they can be passed on to loved ones in a very tax efficient manner.

Ms Morrissey said: “The government’s moves have upturned people’s plans. Instead of leaving pensions untouched until after death, it is likely that people will look to soften the effect of the tax by giving money away while they are alive.

“Gifts of any size leave an estate for inheritance tax purposes after seven years, so some will want to get that clock ticking down sooner rather than later. There is also an array of allowances that enable people to gift assets away and they move out of an estate immediately. Examples of these include the annual allowance of £3,000.”

There’s overwhelming opposition to the proposed introduction of IHT on unused pensions, according to a survey conducted by SSAS provider WBR Group.

• Survey of 1,200 people conducted by Opinium on behalf of HL in May.