Law firms should consider later life lending as part of broader inheritance tax planning discussions as demand for estate planning advice rises, according to Key Partnerships.
The referral and partnerships arm of Key Group said legal firms could play a growing role in directing clients towards specialist later life lending advice where housing wealth forms part of their estate.
Research cited by Key Partnerships found that around 80% of law firms are seeing an increase in inquiries about inheritance tax and estate planning, while 66% believe clients are unaware of the full range of IHT planning options available to them.
The latter finding comes from research by the Association of Lifetime Lawyers.
Key Partnerships said the increase in interest reflects concern over the potential impact of IHT on family estates, particularly against a backdrop of rising property values and frozen tax thresholds.
Government figures show IHT receipts reached a record £8.7 billion in the 2025/26 tax year and are forecast to rise to £14.5 billion by 2030/31.
The nil-rate band and residence nil-rate band are due to remain frozen until the 2030/31 tax year. From April 2027, unused defined contribution pension funds are also expected to be included within estates for IHT purposes.
Key Partnerships said these changes were likely to increase the number of families considering how property wealth could be used as part of their wider financial and estate planning.
Later life lending can, in some circumstances, enable homeowners to release capital from their property for gifting, although the firm said awareness of the option among both potential introducers and clients remains limited.
It believes law firms are well placed to identify cases where specialist advice may be appropriate and expects the legal sector to become an increasingly important source of referral partnerships alongside IFAs and wealth managers.
Damon O’Connell, director at Key Partnerships, said: “People looking for IHT and estate planning advice increasingly need to be advised on a wide range of options before deciding how they are going to access wealth as part of retirement planning.
“Law firms are often at the heart of these conversations and are ideally placed to help clients understand the options available to them. That includes ensuring they have access to specialist advice where solutions sit outside their own area of expertise.
“Housing wealth is often one of a client’s largest assets and should form part of the wider conversation around inheritance tax and estate planning.
“Modern lifetime mortgages can play an important role in certain circumstances, but it is essential that clients receive independent, whole-of-market advice from qualified specialists.
“Strong referral partnerships help ensure clients can access the expertise they need while supporting good customer outcomes and a more joined-up approach to estate planning.”
