Annual Edition 2027

The six
structural problems
sitting between
UK private investors
& 2027.

An institutional reference for UK HNW private investors, covering the May 2025 to May 2026 landscape and the legislative changes that reshape it for 2026–27 and beyond.

Annual Edition 2027 May 2026 Enterprise UK Research Sponsored by Unlock
01
Chapter 6
BPR cap raised twice through the year
Business Property Relief thresholds were lifted on two separate occasions during the period.
02
Chapter 5
April 2027 pension change
From 6 April 2027, defined-contribution pension pots fall inside the estate for IHT purposes.
03
Chapter 5
Nil-rate-band freeze extended to April 2031
Nil-rate-band freeze extended to April 2031.
04
Chapter 4
VCT income tax relief drops from 30 to 20 percent
From 6 April 2026.
05
Chapter 4
UK CGT annual exemption at £3,000
Halved from £6,000 in tax year 2024–25.
06
Chapter 2
Sterling-gold trading at £2,500–£2,600 spot through late 2025
From roughly £780 per ounce a decade ago.
07
Chapter 2
The advice gap documented in the FCA's own research
Schroders 2025 UK Adviser Survey + FCA Financial Lives 2024.
What changed · May 2025 to May 2026

Seven landscape
changes anchor
this edition.

May 2025
Advice gap widens
52% → 25%
Mid 2025
Gold £2,500–£2,600
per troy oz
26 Nov 2025
NRB freeze extended
to April 2031
23 Dec 2025
BPR cap raised
to £2.5m
6 Apr 2026
VCT relief drops
30% → 20%
27 May 2026 · NOW
Publication,
this report
6 Apr 2027
DC pensions enter
IHT estate
60-second summary

Six problems between
the UK HNW investor
and a tax-efficient 2027.

1
Visibility
They cannot see their position in one place.
2
The advice gap
They cannot legally be advised on three of the asset categories that have most rewarded the past decade.
3
Concentration
They are more concentrated than they realise.
4
HMRC schemes go un-named
The HMRC-approved structures that would fix both gaps go un-named in regulated advice.
5
April 2027 pension change
The April 2027 pension change moves defined-contribution pots into the IHT estate.
6
The £2.5m BPR cap
The 2025–26 Finance Bill cap on combined APR and BPR-relieved assets halves the relief above £2.5m.
Chapter 7

The platform answer. Chapter 7 names the operational layer that responds to all six. The next 4,500 words are why the six matter.

Foreword

One tax-year from
the largest change
to IHT architecture
in a decade.

The UK private investor with £500,000 or more in liquid wealth holds it across more accounts than they can easily tally. An ISA at one platform, a SIPP at another, a defined-contribution pot from a former employer, an alternatives allocation tracked in a spreadsheet, a property estimate that has not been refreshed since the last rate move, and the residual cash position that grew through 2024 and 2025 because the rest of the portfolio offered no clear place to add.

That investor is about to walk into the April 2027 pension change. From 6 April 2027, defined-contribution pension pots fall inside the estate for inheritance-tax purposes. The Treasury has confirmed the rate. The implementation date is fixed. The reader of this report has roughly eleven months to decide what to do with a pot that was previously outside the IHT net and now is not.

This report names three outcomes that matter to the reader and traces each through the six structural problems the chapters diagnose. The April 2027 pension change and IHT exposure. The income-tax route through EIS, SEIS, and VCT. The CGT and IHT route through the same scheme stack plus the BPR cap raised to £2.5m on 23 December 2025.

Enterprise UK publishes this report as an independent reference for the UK HNW private investor. EUK does not manage money, does not sell products, and does not operate inside the FCA perimeter. The report is free, ungated, and unsigned.

"What cannot be seen cannot be managed."

Chapter 1 · Visibility
Route in

Readers short on time can skim Chapter 5 (the April 2027 pension change) and Chapter 6 (the £2.5m BPR cap) directly; the diagnostic chapters that precede them are why the legislative changes matter.

Chapter 1

Visibility

The UK HNW investor's wealth sits in eight places. An ISA platform. A SIPP provider. One or more workplace pension pots, often from former employers and often forgotten. A general investment account, possibly at a different broker. A property estimate, refreshed when the bank or estate agent says so. An alternatives allocation, tracked in a spreadsheet or not tracked at all. Cash, distributed across two or three accounts. And, occasionally, a holding of employer stock or a venture position that does not fit cleanly into the rest.

No platform pulls these together. The ISA platform sees the ISA. The pension provider sees the pension. The mortgage provider sees the property. The investor, if they want to see the whole, opens a spreadsheet, types numbers in by hand, and accepts that those numbers will be out of date within a week.

This is not a complaint about software. It is a structural feature of how UK private wealth is administered. ISA platforms report to HMRC, not to other providers. Pension providers report to the Pensions Regulator, not to the ISA platform. The architecture is designed for institutional reporting, not for the investor's own decision-making.

The eight-account picture
ISA platformPlatform A
SIPPProvider B
Workplace pensionsFormer employers
GIABroker C
PropertyEstimate only
AlternativesSpreadsheet
CashTwo or three accounts
Employer stock / ventureAd-hoc
The architectural point. No platform pulls these together. The architecture is designed for institutional reporting, not for the investor's own decision-making.
Chapter 2

The advice gap,
with the performance
evidence.

+220%
Sterling gold, 2015 to 2025. £780/oz → £2,500–£2,600 spot
+38,400%
Bitcoin, sterling, 2015 to 2025
12–17%
EIS median IRR range, by vintage

UK regulated advice cannot, by law, recommend three of the best-performing investment categories of the past decade. Physical gold, denominated in sterling, has risen from approximately £780 per ounce in 2015 to a £2,500–£2,600 spot trading band through late 2025. Bitcoin, denominated in sterling, has risen from approximately £200 per coin in 2015 to around £77,000 average through 2025.

The Schroders 2025 UK Adviser Survey records the steepest drop on record in adviser willingness to serve sub-£50,000 clients: from 52 percent in 2019 to 25 percent in 2025. The advice gap is not narrowing. It is widening at the bottom and tightening at the middle.

This is not a criticism of any individual adviser. The advice gap is a perimeter problem, not a competence problem. A wealth manager who held client funds in a 60/40 allocation over the past decade did exactly what their regulatory frame asked of them.

Rebased performance · 2015–2025 · GBP
Bitcoin
38,400%
Gold
+220%
EIS (median)
12–17%
FTSE All-Share
~60%
Sources: LBMA PM Fix; Exchange Rates.org BTC/GBP; BVCA Performance Survey 2022; FTSE Russell. Bitcoin axis truncated.
Chapter 3

Concentration,
with the 60/40
evidence.

Take a UK HNW investor with £2m of investable wealth. Half is the family home, £1m, owned outright after a long mortgage. £400,000 sits in a defined-contribution pension, predominantly UK-listed equity tracker. £250,000 sits in ISAs and a GIA, again UK-listed plus a small global tracker. £200,000 is in cash. £150,000 is in BTL property.

This portfolio is not diversified. The investor feels diversified because the holdings sit across different account types. On these weightings, the resulting concentration ratios are 57 percent property exposure, 81 percent UK-economy exposure across all assets, and 67 percent illiquid.

Through 2022, the 60/40 theory failed visibly. The FTSE All-Share returned approximately flat in nominal total return terms, while the UK 10Y gilt total return came in at approximately minus 25 percent — the worst calendar year on record for UK gilts. The two asset classes fell or stalled together.

£2m HNW illustrative composite
Family home
50% · £1m
DC Pension
20%
ISA + GIA
12.5%
Cash
10%
Buy-to-let
7.5%
57%
Property
exposure
81%
UK economy
exposure
67%
Illiquid
position
Chapter 4

The HMRC schemes.

EIS
Annual cap
£1m (£2m KIC)
Income tax relief
30%
CGT
Deferral until disposal
IHT
100% after 2yr, under £2.5m cap
3yr minimum hold
SEIS
Annual cap
£200k
Income tax relief
50%
CGT
50% reinvestment relief
IHT
100% after 2yr, under £2.5m cap
3yr minimum hold
VCT
Annual cap
£200k
Income tax relief
20%
CGT
Tax-free dividends + growth
IHT
None
5yr minimum hold
BPR
Annual cap
n/a
Income tax relief
n/a
IHT
100% under £2.5m cap; 50% above
CGT
n/a
2yr minimum hold
£100k EIS worst-case arithmetic, net cost after reliefs
£100k
Gross investment
£70k
After 30% income tax relief
£42k
After loss relief at 45%
£100k
Full upside preserved

Net cost to investor at worst: £42k on a £100k gross investment, while preserving full upside exposure across all scenarios. Assumes investor at 45% marginal income tax rate.

Chapter 5

April 2027:
the pension change
and what it does
to IHT exposure.

From 6 April 2027, the value of a defined-contribution pension at the holder's death falls inside the estate for inheritance-tax purposes. Before that date, DC pots passed outside the estate (within annual allowance limits) and avoided the 40 percent IHT charge on the value above the nil-rate band.

The arithmetic is straightforward. A UK HNW investor with a £500,000 DC pension and an estate already at the £325,000 nil-rate band sees that £500,000 pension exposed to a 40 percent IHT charge at death. £200,000 of additional IHT becomes payable, against £0 under the prior rule.

The clean two-year BPR conversion route closed approximately one month before this report's publication date. The drawdown route and the do-nothing route remain workable through the eleven months to April 2027 and beyond.

Before 6 Apr 2027
£0
DC pension passes outside the IHT estate
From 6 Apr 2027
£200,000
40% IHT on £500k pension above £325k NRB
Three response paths against the April 2027 rule
Longest runway
Draw down
Draw down before death and use after-tax proceeds for gifts, EIS investments (IHT relief after 2 years), or other estate-reduction structures. Taxed at marginal rate (40% or 45%). Seven-year gift clock starts today.
Partial window open
Convert to BPR
Convert pension wealth into BPR-qualifying assets. Action this calendar year places the holding inside the two-year relief frame by May 2028. Capped at £2.5m combined APR + BPR per estate.
Always available
Do nothing
Accept the IHT exposure, adjust the rest of the estate plan around it. Expected IHT becomes a known liability, planned for, met from the estate at death.

HM Treasury, Autumn Budget 2024 (30 October 2024), pensions IHT measures. OBR, supplementary release on IHT on pension wealth, January 2025. HM Treasury, Autumn Budget 2025 (26 November 2025), nil-rate-band freeze extension. Finance Bill 2025–26.

Chapter 6

The £2.5m
BPR cap.

Business-property relief (BPR) gives inheritance-tax relief at 100 percent on qualifying business assets held for at least two years. The relief has applied since 1976. The Autumn Budget 2024 announced a £1m cap above which relief would halve to 50 percent, effective 6 April 2026. On 23 December 2025, HMT raised the cap to a combined APR + BPR allowance of £2.5m per estate.

The net IHT charge on the excess therefore rises from zero to 20 percent (40 percent IHT, halved). For a UK HNW investor with £2m of BPR-qualifying assets, the holding sits below the £2.5m cap; no new IHT exposure under current law. For a £3m holding, the new exposure is £100,000.

The cap is spouse-transferable. A married couple with combined BPR-eligible assets up to £5m therefore benefits from full relief on the entire holding.

IHT exposure by holding size
£1m holding
£0
Below cap · no exposure
£2m holding
£0
Below cap · no exposure
£3m holding
£100k
20% on £500k above cap
£5m holding
£500k
20% on £2.5m above cap
£2.5m
Single estate
£5m
Married couple

HM Treasury, Autumn Budget 2024 (30 October 2024). HM Treasury announcement 23 December 2025 raising combined APR + BPR allowance to £2.5m. Finance Bill 2025–26 (parliamentary stages incomplete as of publication).

End of report

Editor's note. The six chapters above are the Enterprise UK Research report for the 2027 annual edition. They were written and edited independently of Unlock, the platform that sponsors this edition. The single chapter that follows is the sponsor section. The reader who wants the report alone can stop here without missing the report.

Methodology and sources

How this report was produced.

This report covers the UK private-investor landscape over the twelve months from May 2025 to May 2026. Performance data is calendar-year-bounded where the source provides annual snapshots, and rolling-window where the source is daily.

Currency basis is sterling throughout, including the gold and Bitcoin price series, converted from USD per ounce or per coin to GBP equivalent at the prevailing daily rate. Tax rates and thresholds are quoted at the rates applicable on the publication date, 27 May 2026.

Primary sources: HM Treasury Autumn Budget 2024 & 2025; Finance Bill 2025–26; OBR supplementary release on IHT on pension wealth (January 2025); HMRC Inheritance Tax Manual 2026 update; LBMA PM Fix; BVCA Performance Survey 2022; Schroders UK Financial Adviser Survey 2025; FCA Financial Lives 2024; Bank of England working paper on the 2022 gilt market crisis; Vanguard UK stock-bond correlation analysis.