Millions in the dark on inheritance as tax pressures rise, survey finds
Wealth manager data shows many Gen X and millennials have not discussed parents’ estate plans even as inheritance tax receipts climb and policy changes loom
A sizable share of adults say they have never discussed inheritance plans with their parents even as rising tax receipts and looming policy changes increase the likelihood that estates will face higher inheritance tax bills.
According to research by wealth manager Charles Stanley, 36% of Generation X — those aged 44 to 59 — reported they had not spoken to their parents about inheritance plans. The firm also found that for millennials a large proportion had not broached the issue, with about 89% saying they had not discussed parental inheritance arrangements and roughly 27% saying they did not know what their parents intended to do with their estates.
The gap in communication comes as government tax receipts from inheritance tax are rising. HM Revenue & Customs reported a record £3.1 billion collected between April and July, an increase of about £200 million compared with the same period last year, and projected receipts of around £9 billion by the end of the tax year. Separately, research from investment platform Hargreaves Lansdown shows about one in three people say they are relying on an inheritance to help fund their own retirement.
Experts and industry figures warned that frozen thresholds and upcoming regulatory changes are likely to push more estates into the inheritance tax net. Charles Stanley’s Lisa Caplan, director of Charles Stanley Direct advice and guidance, pointed to two policy shifts that could increase liabilities: the continued freeze on inheritance tax thresholds until 2030 and planned rules that will bring pension assets into estates from 2027.
“With thresholds frozen until 2030, and pension assets being included in estates from 2027, the number of families finding themselves having to pay IHT on their loved ones' estates is set to grow sharply,” Caplan said. “It's critical that people understand the value of their estates, have plans in place for how they will pass wealth on, and, importantly, communicate this with their family.”
The Charles Stanley analysis also highlighted that a significant minority of older generations have not formalised their wishes: about one in five baby boomers have yet to draft a will, leaving those estates potentially subject to rules of intestacy rather than the decedents’ intentions.
Financial advisers say the combination of limited family discussion, changes to tax treatment and incomplete wills increases the risk that beneficiaries will face unexpected tax bills or legal disputes. The inclusion of pension assets in estate calculations from 2027 could be particularly consequential for families where substantial pension savings were previously considered outside the estate for inheritance tax purposes.
Industry figures urged clearer planning and communication but stopped short of prescribing specific tax or legal strategies. The findings add to a broader debate about the adequacy of current thresholds and the transparency of intergenerational wealth transfer as the UK faces rising public receipts from inheritance tax.
Policymakers have set the inheritance tax thresholds to remain unchanged through 2030, and the government’s changes to pension taxation and estate treatment are scheduled to take effect in 2027. Those timelines mean advisers and families have a narrow window to assess estate values and consider the legal steps — such as wills, trusts or other arrangements — that could affect future liabilities and the distribution of assets.