Executors and pensions: the April 2027 rules and the deadlines

Who is liable

For deaths on or after 6 April 2027, HMRC's position is that personal representatives are responsible for reporting and liable for paying any inheritance tax due on notional pension property. The statutory route is the replacement section 210 of the Inheritance Tax Act 1984, made by section 67 of the Finance Act 2026, which provides that those liable include the deceased's personal representatives.

Liability does not stay there. From the point that notional pension property is vested in a beneficiary, that beneficiary becomes jointly and severally liable with the personal representatives for the tax attributable to it. Vesting happens when the trustees decide who receives the money, and HMRC has confirmed that the timing of any later payment is not relevant to that.

Scheme administrators are not liable in the ordinary case. Section 210(3)(b) makes them liable only where a benefit was paid in breach of a withholding notice, or where they failed to comply with a payment notice, and in the latter case their liability is capped at the tax they failed to pay. Scheme trustees are expressly taken out of liability.

The deadlines

Inheritance tax is due at the end of the sixth month after the month of death, under section 226 of the 1984 Act, and interest runs from that point under section 233. HMRC confirms the position for pensions in terms: the tax is due as normal at the end of the sixth month, and after that late payment interest accrues on anything outstanding.

There is no instalment option on pension property, and no deferral while the scheme makes up its mind. That is the heart of the problem. HMRC's own worked example has a death in April 2027, beneficiaries not notified until October, payment not made until 2028, and interest accruing from the end of October 2027 throughout.

Period	What it governs	Where it comes from
28 days	Scheme to provide the value of the notional pension property after a request	SI 2026/818
Later of 28 days, or 14 days from the decision	Split between exempt and non-exempt beneficiaries	SI 2026/818
14 days	Scheme to confirm a withholding notice is valid, or to explain why it is not	SI 2026/818
35 days	Scheme to pay HMRC under a valid payment notice	IHTA 1984 s.226B(2)
End of the 6th month after death	Tax due; interest runs	IHTA 1984 ss.226, 233
15 months from the end of the month of death	Longest a withholding notice can run	IHTA 1984 s.226A(7)(c)

The first three of those are worth noting carefully. They are not in the Finance Act 2026. They are in the Registered Pension Schemes (Provision of Information) (Miscellaneous Amendments) Regulations 2026, made on 13 July 2026 and in force from 6 April 2027. Anything that cites the Act for the 28-day or 14-day limits is citing the wrong instrument.

Getting the information out of the scheme

A personal representative has to find every arrangement the deceased held, ask each administrator for a value, and chase the ones that do not answer. The regulations give the administrator 28 days from the request to provide the valuation.

The split between exempt and non-exempt beneficiaries runs on a different clock, and this is the one that causes the damage. It is due by the later of 28 days from the request, or 14 days after the beneficiaries are determined. HMRC's illustration makes the effect plain: if beneficiaries are decided on day 21 after the request, the information is due within 14 days of that decision, so 35 days after receipt. Where a discretionary decision takes months, the information arrives months later, and the six-month clock has been running throughout.

A prospective personal representative can make the request before the grant is issued. HMRC has confirmed that schemes will need to share information and respond to notices before a grant, and in England and Wales rule 22 of the Non-Contentious Probate Rules 1987 sets the order of priority for who that can be. Waiting for the grant before writing to schemes wastes the part of the six months that is easiest to use.

Finding the arrangements in the first place

Before any of the clocks can be used, the arrangements have to be found. A deceased person with a normal working life may have half a dozen pots across former employers, and the paperwork for the oldest of them will not be in the house. The Pension Tracing Service, old payslips and P60s, correspondence from administrators, and the deceased's own bank statements showing contributions are the usual starting points. Every arrangement found needs its own request, and each request starts its own 28-day period.

It is worth recording the date of each request on the file, because the 28 days runs from receipt and the later split obligation runs from the same request. Where an administrator misses the window, a dated record of what was asked and when is what turns a chase into something with weight behind it.

Withholding notices

Section 226A of the 1984 Act lets a personal representative, or a prospective personal representative who has reason to believe they would be liable, give a notice requiring the scheme not to pay out part of a benefit.

Three limits apply. The notice cannot take the total withheld above 50% of the beneficiary's entitlement. It cannot run later than 15 months after the end of the month in which the member died. And scheme rules cannot be used to get round it: section 226A(9) makes the rules of a registered scheme void so far as they purport to require a payment in breach of the cap.

The administrator must confirm within 14 days that the notice is valid, or explain within the same period why it is not, and within 28 days of a valid notice must also provide the total withheld and the split between beneficiaries.

HMRC has said the power is not intended to be used routinely or as a precaution. It is a tool for a case where there is a real risk the money leaves before the tax is dealt with, and it should be used on that basis.

Payment notices

Section 226B allows a person liable for the tax to require the scheme administrator to pay it directly to HMRC out of the benefits. HMRC calls this the Pensions Direct Payment Scheme; that label is HMRC's own and does not appear in the Act, which refers to a payment notice.

The administrator must pay the amount specified within 35 days of receiving the notice, and that period does not begin until a valid notice has been received. A notice must specify at least £1,000 or it is invalid, and where the tax due is less than that the personal representative or beneficiary has to find the money elsewhere. The Treasury can change the £1,000 figure by regulations.

Personal representatives, beneficiaries and trustees who are beneficiaries can give a payment notice. A prospective personal representative cannot, which is the main difference from withholding. The notice can be given before probate is granted.

There is an income tax advantage that is easy to miss. Paying the inheritance tax straight out of the scheme reduces the benefits payable to the beneficiary, so where income tax is due it applies to the amount net of the inheritance tax.

Where this goes wrong

Put the pieces together and the shape of the problem is clear. The tax is due at six months. It cannot be paid in instalments. Interest runs from that date regardless. But the money is inside a scheme that has its own decision to make, and the only lever that gets it out is a payment notice with a 35-day clock that does not start until the notice is valid.

The practical consequences for an estate are these. The information should be requested before the grant, not after. The six-month date should be diarised on the day the file is opened, not when the valuations arrive. Where a substantial pension is involved and the trustees have not decided, the funding question — whether to withhold, whether to give a payment notice, or whether to find the cash elsewhere — needs an answer before month six. After it, the interest is already running.

What to tell the beneficiaries

Beneficiaries frequently do not know that they can become liable. Once the trustees have decided and the property vests, they are jointly and severally liable with the personal representatives for the tax on what they receive. Someone who takes a payment and spends it can still be pursued for the tax attributable to it. Telling them early, in writing, is both the fair thing and the thing that makes a payment notice easier to explain when it is proposed.

Some of this is still moving. HMRC has published two technical notes and has said a third will deal with international issues, the detailed income tax interaction, intestacy and trusts. Two further statutory instruments are expected before April 2027, one of them intended to let estates holding pension property qualify as excepted estates. Until that is made, whether a simple estate with a pension can avoid a full account is not settled.

Frequently asked questions

Who pays the inheritance tax on an unused pension?

The personal representatives are responsible for reporting it and liable for paying it. Once the property vests in a beneficiary, that beneficiary is jointly and severally liable with them for the tax attributable to it. Vesting happens when the scheme trustees decide who receives the money, not when the money is paid, so liability can attach well before anything leaves the scheme.

When is the tax due, and does interest run?

It is due at the end of the sixth month after the month of death, under section 226 of the Inheritance Tax Act 1984, and interest runs from that point under section 233. HMRC has confirmed this applies to pension property. There is no deferral while the scheme decides who the beneficiaries are, so interest can accrue for months before anyone has been paid anything.

Can we act before the grant of probate?

Partly. A prospective personal representative can request information from a scheme and can give a withholding notice, provided they have reason to believe they would or might be liable. They cannot give a payment notice. HMRC has confirmed schemes must engage before a grant is issued, so writing to schemes early uses the part of the six months that is otherwise wasted.

How long does a scheme have to give us a valuation?

28 days from receiving the request, under the Registered Pension Schemes (Provision of Information) (Miscellaneous Amendments) Regulations 2026. The split between exempt and non-exempt beneficiaries is due by the later of 28 days from the request or 14 days after the beneficiaries are determined, which on a discretionary decision can be considerably longer.

What is a withholding notice and when should we use one?

It requires a scheme not to pay out part of a benefit. It can freeze up to 50% of a beneficiary's entitlement and cannot run beyond 15 months after the end of the month of death. HMRC has said it is not intended for routine or precautionary use, so it suits a case where there is a real risk the money leaves the scheme before the tax is resolved.

Can the scheme pay the inheritance tax directly to HMRC?

Yes, on a payment notice under section 226B. The administrator must pay within 35 days of receiving a valid notice, and the notice must specify at least £1,000. There is an income tax benefit: paying this way reduces the benefits payable to the beneficiary, so where income tax is due it applies to the net amount. A prospective personal representative cannot give one.

Can the tax on the pension be paid by instalments?

No. Instalments are available only on qualifying property under section 227 of the 1984 Act, and notional pension property does not meet that definition. Loss on sale relief is also unavailable. Combined with interest running from the six-month date, that is why the funding question needs an answer before month six. Waiting for the scheme to pay out is what causes the interest.

Sources & further reading

• legislation.gov.uk — Finance Act 2026, section 67 (liability)
• legislation.gov.uk — Finance Act 2026, section 68 (withholding and payment notices)
• legislation.gov.uk — SI 2026/818, information regulations
• legislation.gov.uk — IHTA 1984, section 226 (payment of tax)
• legislation.gov.uk — IHTA 1984, section 233 (interest)
• GOV.UK — Technical note: Inheritance Tax on pensions
• GOV.UK — Further information on Inheritance Tax and pensions

This article is general information, not legal advice. The law changes and depends on your circumstances — always take advice on your specific situation before acting. Last reviewed 21 September 2026. AD Solicitors Limited is a recognised body regulated by the SRA (no. 8011228).