Retired scientist slams inheritance tax change as bill ‘triples’ after Rachel Reeves’ announcement

The Chancellor’s Autumn Budget changes have been dredged back into the spotlight after a retiree slammed the impact of her inheritance changes. Although these changes will only come into force from April 2027, some are scrambling to adapt their plans as previously tax-free loopholes have now been closed.

Most notably, Rachel Reeves announced that pension pots passed on after death will no longer be tax-free, upending the financial planning for countless wealthy families. One particularly upset Briton decided to take a stand, penning a letter to the Chancellor which was published in the Telegraph.

The 69-year-old gave the Chancellor an insight into their life after studying hard at school, being the first in their family to attend university and enjoying a “long and successful” career in science. They were lucky enough to retire at 60 thanks to wise planning and saving when they started feeling “worn out” by their demanding job.

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Planning ahead, the Leicester-born retiree had previously calculated their dependents would face a £200,000 inheritance tax bill. Now, however, after the Chancellor’s budget they face a “gut-wrenchingly unjust” £640,000 tax bill, the Express reported.

On top of this, due to technicalities around how pension pots are currently inherited, their beneficiaries would also face an additional £360,000 income tax bill on their inheritance. The writer claims Reeves had hidden a “sinister” threat behind this pension pot raid noting that the seemingly easiest way to mitigate this and leave £800,000 more behind would be to die before April 2027.

They fumed that the Government has “already taken its pound of flesh” from them after a lifetime of dutifully paying their taxes and being a contributing member of the economy for decades. They exclaimed that they were happy to fulfill this role because it “had all been worthwhile” as they enjoyed a retirement their parents couldn’t on top of leaving a legacy of wealth for their family left behind.

However, the writer raged: “But that has been stolen by a Budget that effectively punishes people for following the rules of working hard and saving diligently for retirement so that the state does not have to spend a penny to support them – someone who’s self-sufficient, to the very end.” It’s also not just retirees who are having to rethink their entire family’s financial planning, but experts are also hitting out at Reeves’ plans.

AJ Bell CEO Michael Summersgill warned in late November that the practicalities of how these inheritance tax bills will be worked out and implemented could “create huge complexity and will delay families from accessing money in a timely fashion”. He even claimed that some complexities will make the proposed change “unworkable” and “create financial gridlock in the probate process”.