153,000 UK Households Face New Inheritance Tax Liability

New rules announced in the Labour Party's Budget will subject pensions to inheritance tax (IHT) starting April 2027, affecting over 153,000 households. This change, led by Chancellor Rachel Reeves, is expected to bring 31,200 families into the tax bracket for the first time by 2030, while 121,500 current taxpayers will see increased bills. The decision is seen as a significant shift, particularly for those with modest estates, as pensions will now be included in estate calculations for IHT purposes. Analysts warn this could disproportionately impact middle-class families already facing financial strain, as the nil-rate band remains frozen amid rising property prices. The government projects the change could raise nearly £1.5 billion by 2030, heightening concerns about long-term financial security and the incentive to save for retirement. Overall, the new policy reflects a strategy to broaden the tax base and replenish public finances.