Pensions on the Radar for 2026: Key Takeaways from Pi Partnership

APPT Code of Practice - The Association of Professional Pension Trustees has published an updated code of practice for professional corporate sole trustees. This will be effective from 1 January 2026, to allow time for firms to update their processes and procedures, where required and sets outs the standards expected of a professional sole trustee. 

Salary Sacrifice of Pension Contributions – The recent budget announcement that the government will be capping NICs relief on salary sacrifice into pension schemes to the first £2,000 of pension contributions from 2029 was not a shock. Earlier this month The Society of Pension Professionals (SPP) issued a paper exploring the impact of reducing or removing salary sacrifice arrangements for pension contributions. 

Inheritance Tax - The Government/HMRC is going ahead with plans to include most unused pension funds and death benefits in the value of an individual’s estate for IHT purposes from 6 April 2027. However, all death in service benefits payable from registered pension schemes will be out of scope of IHT, whether discretionary or non-discretionary. HMRC did make some important changes to its original proposals, including that personal representatives (“PRs”) rather than pension scheme administrators (“PSAs”) will be primarily liable for reporting and paying IHT on any unused pension funds and death benefits. However, pension beneficiaries may be able to give notice requiring their scheme’s PSA to pay the IHT on their behalf directly to HMRC. The Government published draft legislation to implement these changes for technical consultation. The deadline response was 15 September 2025 and the response is awaited. These changes are set to come into effect from 6 April 2027. 

VAT & HMRC - Notable for any Scheme where the employer reclaims VAT on adviser fees; HMRC have announced a change to VAT policy to allow employers to recover up to 100% of VAT on pension scheme investment costs. 

Pre-Pension Income Gap and Rise in SPA – the SPA will increase from 66 to 67, phased in over two years starting in April 2026. The Work and Pensions Committee (WPC) has launched an inquiry into the likely impact of the increase on individuals in the pre-pension years, who are more likely to leave work for health reasons or to care for partners, but who are not yet eligible for State Pension. The inquiry notes that the increase in SPA from 65 to 66 led to 100,000 more 65-year-olds being in absolute poverty. The call for evidence closes on 19 December 2025. 

Virgin Media – by way of reminder, this refers to the Virgin Media Ltd v NTL Pension Trustees II Ltd court case, which determined that amendments to contracted-out pension schemes made without the required actuarial confirmation are void. The UK government is introducing legislation to address the fallout from the Virgin Media pension case, which invalidated many historical pension scheme amendments made without proper actuarial confirmation. Amendments to the Pension Schemes Bill 2025 were proposed in September 2025 to provide a "fix," allowing schemes to seek confirmation from the current actuary that the required confirmation could have been given at the time, thereby treating the amendment as valid. This legislative "fix" is expected to come into force in mid-to-late 2026, but schemes should seek advice before taking any action, as some steps may make them ineligible for the fix. 

The Pension Schemes Bill – Linked to the above update, it appears that the Pension Schemes Bill is still stuck at the report stage, with no date scheduled yet for when the public bill committee will report back to the House of Commons on the amendments that it has made to the bill. Since the public bill committee finished its review, more amendments have been tabled to the bill for consideration at the third sitting of the House of Commons. The list of amendments as of 12 November 2025 comprises 22 new proposed clauses to the bill, and 13 amendments to existing draft clauses. None of the amendments tabled have been proposed by the government, and it could be that many of those amendments do not appear in the final version of the bill 

MaPS Publishes Research – On 5 November, as part of “Talk Money Week”, MaPS published its latest research as part of Talk Money Week, an annual campaign designed “to encourage people to #StartTheConversation about money and pensions”. The statistics are taken from MoneyView 2025, MaPS’ nationally representative survey of over 12,000 adults living in the UK. The findings include: 

Economic Crime & Corporate Transparency Act 2023 (ECCTA) - certain provisions of ECCTA are set to come into force on 18 November 2025. From 18 November 2025, individuals will be prohibited from acting as a director without having verified their identity, subject to transitional provisions of up to 12 months. Failure to comply with the verification obligations is a criminal offence (punishable by a fine), committed by the individual director, the company, and the company’s officers. 

Reminder HMRC Pension Scheme Returns – You may have received an “invitation” from HMRC which requires Scheme’s in receipt of the HMRC notice to file a HMRC Scheme Return to provide substantial Scheme information. I have attached an anonymised example of the HMRC Notice for information. The deadline for submission is 31 January 2026. The gov.uk announcement provides background information by clicking here. If you are unsure if you have received this “invitation” there are ways to check on HMRC’s Managing Pension Scheme (MPS) service if a Scheme had received the HMRC Notice to File a Pension Scheme Return – contact us today and we can share further information.