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£1.8bn in net inflows landed at Royal London in the first half of the year, pushing assets under management to a record £43.6bn as advisers steered clients toward life cover to offset an incoming pension inheritance tax.
Unused pension savings and death benefits become subject to inheritance tax from April next year, under rules announced by former chancellor Rachel Reeves in her 2024 Budget.
Royal London chief executive Barry O'Dwyer confirmed that demand for life insurance taken out specifically to fund the anticipated tax bill has risen materially.
How the liability arises The arithmetic is not complicated. Pension pots previously sat outside an estate for inheritance tax purposes; from April they will not.
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