Seven in 10 (71%) of advisers are worried about pension and inheritance (IHT) changes, a new poll conducted by Quilter has revealed.
And more than half (52%) of those surveyed said their clients will be impacted by the change.
This data was collected from over 460 independent advisers who provided feedback at a series of Quilter roadshows exploring the effect on financial advice.
Chancellor Rachel Reeves used her Autumn Budget last year to announce that pensions will be subject to IHT from April 2027.
As a result, advisers expect 38% of their client book will need ‘rewrapping’ to alternative tax wrappers in the next 12 months.
A number of ways advisers could look to review existing tax wrappers were explored in the roadshow events.
These included reevaluating existing General Investment Accounts (GIA) in light of the reduced annual dividend and CGT allowances and increased rates of CGT.
Another option was reevaluating advice for clients who have reached their maximum PCLS amount in their pension plan now the limit is frozen in perpetuity.
The landscape has fundamentally shifted, and advisers recognise if they continue to do what they have always done, many clients will inevitably pay more tax.
Advisers are responding by revisiting strategies such as gifting surplus income, using trusts and considering investment bonds to help clients preserve wealth.
The survey reveals strong demand for technical guidance, with:
• 80% of advisers seeking more information on IHT and trusts.
• 58% of advisers looking for guidance on reframing pensions in light of IHT changes.
• 52% of advisers wanting further insights into investment bonds.
Quilter head of technical sales, Roddy Munro, said: “The financial planning landscape is undergoing dramatic changes, prompting advisers to carefully assess the impact on their clients.
“The inclusion of pensions within inheritance tax (IHT) will fundamentally alter how wealth is structured for inheritance.
“This announcement, along with others in last year’s Autumn Budget, has shone a spotlight on the importance of estate planning, forcing many to rethink traditional IHT and retirement planning strategies.
“This shift presents a significant opportunity for advisers to demonstrate the value of their expertise, as clients now more than ever need professional advice to avoid a substantial increase in their tax burden.
“We are already witnessing advisers seeking a broader array of tax wrappers and trusts to adapt to the evolving landscape.
“As fiscal policy continues to evolve, it is crucial for advisers to have access to clear, practical solutions to help their clients achieve the best possible financial outcomes.”
