73. UK Pension and Inheritance Tax: What Legislative Changes in 2027 Mean for British-Connected Expats Abroad

Changes are coming to UK inheritance tax legislation. From April 2027, many expats with UK Self-Invested Personal Pensions (SIPPs) could face a 40% UK inheritance tax hit on pension values above the £325,000 nil-rate band, but the way the new rules are drafted may allow non-long-term UK residents to structure their SIPPs so that non-UK underlying assets sit outside the UK inheritance tax net. 

 

Richard Taylor, dual UK/US citizen and Chartered Financial Planner, is joined by Tobias Gleed-Owen, Senior Associate at Birketts, to discuss the upcoming changes to SIPPs and inheritance tax. This episode of Expat Wealth explores how UK expats, or future recipients of a UK inheritance or pension, can prepare for the April 2027 changes. Richard and Tobias unpack how the draft UK rules will treat pensions for inheritance tax, why the position most people have assumed is likely wrong, and how looking through to the underlying investments in an SIPP may keep large portions of a UK pension outside the UK inheritance tax net. 

 

In this episode, Richard and Tobias take a detailed look at: 

 

The big picture: An overview of the 2027 UK inheritance tax change on pensions. 

 

Practical planning opportunities: How to structure or restructure your SIPP investments. 

 

What to do if you have an old defined benefit pension. 

 

Pension Commencement Lump Sums: Whether or not the UK 25% “tax-free lump sum” is tax-free in the US. 

  

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Expat Wealth is supported by Plan First Wealth. Plan First Wealth is a Registered Investment Advisor serving fellow expatriates and immigrants living across the US on matters such as retirement planning, investment management, tax planning and non-US asset management. 

 

https://planfirstwealth.com/ 

 

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Expat Wealth is affiliated with Plan First Wealth LLC, an SEC registered investment advisor. The views and opinions expressed in this program are those of the speakers and do not necessarily reflect the views or positions of Plan First Wealth.   

 

Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Plan First Wealth does not provide any tax and/or legal advice and strongly recommends that listeners seek their own advice in these areas.