'A Fundamental Shift' — Inheritance tax changes are biggest for a generation and clients are not ready, survey reveals

As few as one in 10 people have properly spoken to their families about their inheritance plans, startling new figures have revealed.

Last year’s Autumn Budget was the new Labour government planting a flag, the party’s first budget in nearly a decade and a half.

Chancellor Rachel Reeves announced a 6.7% increase in the National Living Wage, £22.6 billion increase in day-to-day healthcare spending and, crucially, a raft of changes to inheritance tax (IHT).

IHT thresholds were frozen until 2030 and it was revealed pensions will be counted as part of the assets subject to tax from 2027 onwards.

Reeves’ statement also introduced significant changes to IHT around Business Property Relief (BPR) and Agricultural Property Relief (APR). Relief will now only apply fully to the first £1 million of qualifying assets, with the remainder taxed at an effective 20% rate.

Now, Brodies LLP has released the findings of a startling new survey, conducted by YouGov in April this year, and has warned that the legal sector in Scotland must be braced for the impact of IHT reforms.

“These reforms fundamentally shift the taxation landscape for estates, businesses, and trusts,” said Mark Stewart, partner at Brodies LLP. “There is a clear knowledge gap among those impacted, underscoring the vital role of legal, tax and wealth professionals in guiding clients through structured succession planning.”

The survey sampled 2,001 adults aged 50 and above across the UK and revealed what the firm has described as a widespread lack of understanding about the tax changes. As few as 26% of respondents claimed to fully grasp the implications.

The findings are a stark warning to and opportunity for solicitors, law firms, tax advisers and estate planners to inform, educate and engage with clients.

“Professional advisors must take a leadership role in informing clients,” added Mark Stewart, “From succession structuring to navigating relief restrictions, we must ensure clients understand their tax position and the long-term consequences of inaction.”

Key insights from the survey

• only 10% of respondents have engaged in detailed discussions about inheritance with their families;
• fairness and the risk of dispute are leading concerns among respondents—28% cite equitable distribution as a key issue, while 23% fear family conflict due to wealth transfer.
• limited awareness: while 54% of respondents are aware of the IHT reforms, they remain unclear on personal impact, leaving them vulnerable to missed planning opportunities;
• lack in formal planning: less than half (41%) have a structured estate plan in place, while 35% acknowledge they should plan but have not begun the process, creating legal and financial risk; and
• underutilisation of professional advice: only 16% have sought professional guidance—despite the complexity of phased tax relief reductions and domicile rule shifts.

The full report can be viewed here