The key date is 6 April 2027. From that day, most unused pension funds and death benefits are included in a person's estate for inheritance tax, and the change applies to deaths on or after that date. It was announced at the Autumn Budget on 30 October 2024, refined through a technical consultation over the winter of 2024 to 2025, and written into law when the Finance Act 2026 received Royal Assent on 18 March 2026. The start date is no longer a proposal. It is legislation.
This post is the dates and deadlines companion to our full guide to the 2027 pension IHT reform. Here we set out exactly what happened when, what still has to happen before April 2027, and, most practically, what the date of death means for a family dealing with an estate right now. If you want an estimate of what the change could mean for a specific estate, the pensions and IHT 2027 estimator works it out in a couple of minutes from the pension value and the rest of the estate. This article covers England and Wales, and it is general information rather than financial or tax advice.
The full timeline at a glance
Every material date in the story so far, plus what is still to come:
| Date | What happened (or happens) |
|---|---|
| 30 October 2024 | Autumn Budget 2024. The Chancellor announces that unused pension funds and death benefits will be brought into inheritance tax from 6 April 2027. |
| 30 October 2024 to 22 January 2025 | HMRC runs a technical consultation on how the liability, reporting and payment processes should work in practice. |
| 21 July 2025 | Government publishes its consultation response and draft legislation. A key design change is confirmed: personal representatives, not pension schemes, will be responsible for reporting and paying the tax, and death in service benefits from registered pension schemes are excluded. |
| Autumn 2025 to early 2026 | The measure passes through Parliament as part of the Finance Bill. |
| 18 March 2026 | The Finance Act 2026 receives Royal Assent. The 6 April 2027 start date is now fixed in law. |
| Through 2026 | Further HMRC guidance, updated forms and process detail expected, so that schemes and personal representatives know how reporting will work day to day. |
| 6 April 2027 | Commencement. The new rules apply to deaths on or after this date. |
| From mid 2027 onwards | The first affected estates begin reporting. Inheritance tax is normally due by the end of the sixth month after the month of death, so the earliest payment deadlines for deaths in April 2027 fall at the end of October 2027. |
The rest of this post walks through each stage, then turns to the question most readers actually have: which side of the line does the death I am dealing with fall on?
30 October 2024: the Autumn Budget announcement
The change was announced in the Autumn Budget 2024. Until then, most defined contribution pension funds sat outside the estate for inheritance tax, largely because death benefits are usually paid at the discretion of the scheme trustees rather than under the will. That treatment had made pensions an increasingly popular way to pass on wealth, and the government's stated aim was to remove the incentive to use pensions as an inheritance vehicle rather than for retirement income.
The announcement set the effective date, 6 April 2027, from the very start. That long lead time was deliberate: the mechanics of taxing pension death benefits are genuinely complicated, and the government wanted time to consult on how it would work.
October 2024 to January 2025: the technical consultation
Alongside the Budget, HMRC opened a technical consultation on inheritance tax on pensions: liability, reporting and payment, which ran to 22 January 2025. Importantly, this consultation was never about whether the change would happen or when. The policy and the date were settled. The consultation asked how the process should work: who should report the pension value, who should pay the tax, and how schemes and estates should communicate.
The original proposal was that pension scheme administrators would report and pay the inheritance tax on the pension element themselves. Respondents across the pensions industry pushed back hard, arguing this would delay payments to bereaved families and create serious practical problems where one person held several pensions.
21 July 2025: the consultation response and a major design change
The government listened. In its July 2025 response and accompanying policy paper, it confirmed the 6 April 2027 start date but changed who carries the administrative burden. Under the final design:
- Personal representatives (the executors named in the will, or administrators where there is no will) are legally responsible for reporting and paying any inheritance tax due on unused pension funds and death benefits, alongside the rest of the estate.
- Death in service benefits paid from registered pension schemes are excluded from the charge entirely.
- The spouse and civil partner exemption continues to apply, so pension funds passing to a surviving spouse or civil partner do not trigger inheritance tax.
- To help with the cash flow problem, up to 50% of the pension amount can be withheld by the scheme for up to 15 months to help fund the inheritance tax liability.
That shift matters enormously for anyone likely to act as an executor. From April 2027, valuing and reporting pensions becomes part of the executor's job, not the scheme's. We cover what that involves in practice in our companion post on what executors need from pension providers after a death, and our executors hub covers the wider role.
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18 March 2026: Royal Assent, the date becomes law
The measure was included in the Finance Bill introduced after the Budget, and the Finance Act 2026 received Royal Assent on 18 March 2026. This is the point at which "proposed" stopped being the right word. The inclusion of unused pension funds and death benefits in the inheritance tax estate, effective for deaths on or after 6 April 2027, is settled law. Only a future Act of Parliament could now change it.
Through 2026: what is still to come
Legislation sets the rules; it does not print the forms. Between now and April 2027, HMRC is expected to publish further guidance and updated processes covering, among other things:
- how personal representatives obtain pension valuations from schemes, and how quickly schemes must respond;
- updated inheritance tax forms and the reporting route for the pension element;
- the detailed mechanics of the option to have the scheme withhold funds towards the tax; and
- how the rules interact with cases involving multiple pensions and hard to trace schemes.
If you are following the detail, our pensions and inheritance tax 2027 research page tracks the published numbers and the state of play as guidance lands.
6 April 2027: which side of the line does a death fall?
For families and executors, the entire reform reduces to one test: the date of death.
Death before 6 April 2027
The current rules apply. Most unused defined contribution pension funds and discretionary death benefits sit outside the estate for inheritance tax. That remains true even if the pension is paid out, probate is granted, or the inheritance tax account is submitted after April 2027. Nothing about the new regime reaches back to earlier deaths.
Death on or after 6 April 2027
The new rules apply. Unused pension funds and death benefits (other than excluded death in service benefits) are added to the rest of the estate when working out inheritance tax. The estate still gets the normal allowances: the £325,000 nil-rate band, the residence nil-rate band of up to £175,000 where a home passes to direct descendants, and the spouse exemption where the pension passes to a spouse or civil partner. Our guide to the UK inheritance tax threshold explains how those allowances stack, and the inheritance tax pillar covers the wider system.
Payment deadlines then follow the normal inheritance tax clock: tax is due by the end of the sixth month after the month of death. So for the very first deaths under the new regime, in April 2027, the earliest payment deadlines arrive at the end of October 2027. That is when the reform stops being a news story and starts appearing on real inheritance tax accounts.
How big is the impact?
HMRC's own estimates, published alongside the policy paper, are the best available numbers. Around 10,500 estates a year are expected to become liable for inheritance tax for the first time because of the change, and a further 38,500 estates that would have paid some inheritance tax anyway are expected to pay more, by around £34,000 on average. Treat those figures for what they are: national estimates, not a prediction for any particular estate. An estate well inside the thresholds may still pay nothing at all; a large pension left to adult children can move an estate from no tax to a substantial bill.
If you hold a significant pension, or expect to inherit one, the practical next step is to see roughly where a specific estate would land. The pensions and IHT 2027 estimator gives a quick, free estimate of the position before and after 6 April 2027, and our pension holders 2027 hub gathers everything on the reform in one place. For a plain English explanation of the mechanics rather than the dates, start with pension IHT 2027 explained.
Speak to a specialist
The timeline is fixed, but what it means for a particular estate depends on the pension type, the beneficiaries and the rest of the estate. This article is general information, not legal, tax or financial advice, and decisions about pensions should always be made with regulated financial advice. If you would like help understanding how the 2027 changes affect an estate you hold or expect to administer, we can connect you with a vetted specialist who deals with this every day.