Inheritance tax changes and pension scams: what employers should know

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From April 2027, changes to the inheritance tax (IHT) treatment of pensions will come into effect. While these changes won’t affect everyone, they are likely to prompt more people to review how their pension savings are structured and passed on.

Our research shows this is already influencing confidence, with over one in five (22%) individuals saying they feel less confident in pensions as a result, and over half (54%) concerned about the potential impact on their beneficiaries.

At times like this – when individuals are reassessing important financial decisions –there can also be a greater risk of pension scams. Employers have an important role to play in helping employees stay informed and alert.

 

1. Why scam risk may increase

Periods of change or uncertainty can create opportunities for fraudsters. As people review their pension arrangements, scammers may attempt to present themselves as offering timely or tax-efficient “solutions”.

This can include suggesting pension savings can be moved into alternative arrangements that avoid inheritance tax. While these may sound credible, they can expose individuals to significant financial harm. The average pension scam is estimated to cost £47,000, and losses are often irreversible.

Even those unlikely to be directly affected by inheritance tax changes may be targeted. Creating a sense of urgency is a common tactic, encouraging people to act quickly before fully understanding their options.

 

2. How employers can support employees

Some employees – particularly those with larger pension savings – may use this time to consider longer-term financial planning, such as how they pass on wealth or whether to make gifts during their lifetime.
These decisions are often complex, and no single approach will suit everyone. Employers can help by creating the right environment for informed decision-making.

Simple ways to support employees include:

• Encouraging a ‘pause before action’ mindset – legitimate financial decisions rarely require immediate action
• Signposting to trusted guidance – such as MoneyHelper or Financial Conduct Authority (FCA) resources
• Promoting awareness of common scam tactics
• Creating space for questions – helping employees feel more confident discussing pensions and planning ahead
• Encouraging them to report suspicious activity – to Report Fraud. 

Providing clear and consistent messaging can reduce the risk of rushed or poorly informed decisions.

 

3. Warning signs to share

Scam tactics are becoming more sophisticated, including the use of realistic documents, cloned websites and even artificial intelligence to mimic trusted organisations or individuals. 

Raising awareness of the warning signs can help employees protect themselves. Key indicators include:

• Unexpected contact – unsolicited calls, emails or messages about pensions
• ‘Too good to be true’ offers – promises of high or guaranteed returns
• Early access claims – offers to unlock pension savings before the minimum age
• Pressure to act quickly – time-limited or exclusive offers
• Requests to move money – particularly into unfamiliar or complex investments

Encourage employees to pause and verify any approach using trusted contact details or tools such as the FCA firm checker.

 

4. Supporting your workforce through change

As the April 2027 changes approach, employees may have more questions about pensions, tax and long-term planning. Clear communication and access to trusted guidance can help build confidence and reduce the risk of scams.

By taking a proactive approach now, employers can support employees to make informed decisions and feel more secure about their financial future.

✔  What employers can do next

• Share clear, timely communications about the upcoming changes
• Signpost employees to trusted sources of guidance and support
• Reinforce key scam warning signs in internal channels
• Encourage employees to seek guidance before making pension decisions