3d • Technical 📊
IHT & pensions - advice risk?
According to the article from FT Adviser linked below, which is based on research by Scottish Widows, nearly half of IFAs are recommending clients move money out of pensions now as part of an IHT-planning strategy. My (genuine) question is ... why?
If a client died between now and 6th April 2027 the fund value is likely to be tax-free if under 75 (I know that's a generalisation, but you hopefully get the point). If their adviser has recommended they withdraw funds that are surplus to requirements, be that PCLS or additional income that isn't spent (i.e. not gifted), then surely they could be liable to challenge by the family. I get the argument that you start the '7-year clock' earlier if it's gifted, but that's still a big risk. Or am I missing something?
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IHT & pensions - advice risk?
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