Two thirds (67%) of people are unaware that it’s only months until most unused pensions are included in an individual’s estate for IHT purposes, despite thinking it applies to them.
Among those who are aware (31% net), very few have taken action.
Almost a fifth, 19%, have not done anything about it, according to research from platform group Nucleus.
Of those that have acted, 4% have spoken to a financial adviser about the change, 2% have reviewed or updated their will as a result, only 1% have made changes to their pensions, investments or other financial arrangements.
Some 5% of people have researched the change to better understand it.
With the changes coming into effect from the new tax year on 6 April 2027, Nucleus says there is an urgent need for the government, as well as the industry, to take action to improve understanding and engagement amongst the public.
The research shows awareness and action increases with age, but 56% of those aged 55+ are still unaware of the changes. Just 6% have spoken to an adviser and 2% have checked or changed their will, with the same number making changes to their financial arrangements.
While a just over a quarter of respondents aged 55+ (27%) believe they are unlikely to be affected, one third of all UK adults (33%) expect to receive some form of inheritance, and a further 38% are actively planning to leave money or assets.
Andrew Tully, Nucleus technical services director said: “With the new rules only months away, the government must urgently step up communication. The changes will create additional administrative and financial pressure for beneficiaries and personal representatives at an already difficult time, yet public awareness remains worryingly low.
“What has not changed is the value of regulated financial advice. Planning for retirement is increasingly complex and the changing IHT rules have the potential to cost many families dearly without proper, informed preparation.”
• Source: YouGov research for Nucleus between 20 and 26 August. 3,859 UK adults aged 18 and over. Figures have been recalculated after excluding respondents who answered “N/A – This change is not relevant to me/my estate is unlikely to be affected by IHT”.