Chase Buchanan Explains How UK Pension Reforms Have Highlighted the Complexities of Cross-Border Estate Planning
Paphos, Cyprus, November 10, 2026 -- Chase Buchanan Private Wealth Management, international specialists in expat financial planning, have reviewed the government's impact estimates of significant reforms to how unused pension benefits will be incorporated into Inheritance Tax (IHT) calculations in the UK from 6 April 2027.
While HMRC’s figures consider the effects on the population as a whole, they do not specifically evaluate the impacts on overseas British expats who retain UK pensions, or how the complexities of contrasting tax regimes and potential double tax treaties will influence retirement and succession planning.
Why UK Inheritance Tax Changes Won’t Impact Only British Tax Residents
From the next tax year, most unused pension funds and death benefits will be included in an individual’s estate when IHT is assessed, meaning pension assets may be taxable and more estates will exceed the relevant thresholds.
As Lee Eldridge, Group CEO and Head of Investment Advisory, explains, ‘The projected impacts produced by the Exchequer are useful, but there has been no evaluation of the effects on the global expat community, which is something we know is highly relevant to many of the clients we support around the world.
This is especially important following the previous reforms in 2025, which mean that HMRC might retain taxing rights over a worldwide estate if, for example, an expat was a UK tax resident for 10 of the last 20 years, even if they subsequently become a tax resident of another country.’
The government’s impact estimates for the 2027/28 tax period indicate that:
· 213,000 estates are thought to contain inheritable pension wealth
· 10,500 estates are expected to incur an IHT tax liability that would not previously have arisen
· 38,500 estates are forecast to be liable to pay more IHT than before the reform
· The approximate average additional IHT for those estates paying more tax is estimated at £34,000
While a parliamentary committee has noted that this may potentially change individuals’ financial plans in terms of pension withdrawals and estate planning, further impacts may apply to expats who might have a UK pension, live overseas as a tax resident, and also have beneficiaries who live in different countries.
These considerations should be taken in the context of the further changes to UK taxation and pensions explored in Chase Buchanan’s review of the Autumn Budget’s impact on British expats living overseas.
The Potential Scale of UK Pension Inheritance Tax Changes for Overseas Expats
Eldridge says, ‘It’s important to emphasise the significance of the forthcoming reforms for expats making retirement plans believing their pension wealth will not be subject to UK IHT, or who have long-standing succession plans that they believe remain in the interests of themselves and their loved ones.
For example, an expat with a significant amount of unused UK-based pension wealth, property or assets based in the UK, and who expects to leave a sizable estate to their beneficiaries, may have much higher exposure than an expat with a modest UK pension who holds the majority of their assets outside the UK.
However, this also doesn’t paint the full picture, because in situations where British citizens have become overseas tax residents, their estate, including unused UK pension wealth, could theoretically also be subject to inheritance tax regimes in the country where they live.’
The UK has inheritance double tax conventions with many countries, which can determine which country has taxing rights over unused pension wealth, or rules that apply tax relief if the same assets are taxed twice. Provisions do, though, vary between agreements, and there are scenarios where a UK pension could be classified, for example, as an investment asset depending on the pension structure and the tax rules in the relevant jurisdiction.
How Expats Living Overseas Can Prepare for Pension Inheritance Tax Reforms
Eldridge clarifies that, ‘Moving overseas doesn’t mean UK IHT is no longer a consideration, and when unused pension wealth and death benefits fall under the scope of this tax, there is certainly the potential for beneficiaries to find that estates are subject to complex cross-border tax treatments.
Reviewing pension and estate arrangements is advisable for anybody concerned about what these changes might mean for their wealth, their estate and their tax exposure, ideally before reforms take effect from next April.’
About the company: Chase Buchanan Private Wealth Management is a highly regulated wealth management company that specialises in providing global finance solutions for those with a global lifestyle. We are global financial advisers, supporting expatriates around the world from our regulated European headquarters, and local offices across Belgium, Canada, Canary Islands, Cyprus, France, Malta, Portugal, Spain, the UK and the USA. Chase Buchanan Ltd is authorised and regulated by the Cyprus Securities and Exchange Commission with CIF Licence 287/15 and offers its services in the EU on a cross-border basis as per the provisions of MiFID. Chase Buchanan Insurance Services, Agents & Advisors is authorised and regulated by the Cyprus Insurance Companies Control Service with License No 6883 and offers services in the EU on a cross-border basis as per the provisions of the Insurance Distribution Directive (IDD). Investing in financial instruments involves risk and may not be suitable for all investors. The value of investments may go up as well as down and past performance is not a reliable indicator of future results. You may lose part or all of your invested capital.
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