The most recent data on how many families fall into the seven-year trap can be found in the 2019 review of inheritance tax carried out by the Office of Tax Simplification, a government adviser, now-disbanded.

This shows that in 2015-16, 4,850 families – 20pc of estates – were caught out by the seven year rule, paying altogether £71m in inheritance tax on the gifts. Of those families, 2,460 died (10pc of estates) within three years of making the transfer, and 1,090 (4.4pc) within just one year.

This was when only 24,500 families paid inheritance tax. Now the figure is far higher – with the Office for Budget Responsibility forecasting that 39,000 families will pay the tax this year. Based on the same proportions, an estimated 7,800 will get caught out by the seven-year rule in 2023-24.

There are no inheritance tax breaks for dying early. However, there is an income tax exemption. If you pass away after turning 75, then anyone who inherits your pension will be taxed on the income at their marginal rate. But pass away before 75, and no income tax is due. It may upset families who have lost a loved one far sooner than expected to learn that HMRC will reduce their tax burden in one instance, but not the other.

Pensions are not subject to inheritance tax. However, the rules are different and more complicated for pension transfers. If someone transfers their pension benefits knowing they are terminally ill, they could land their family with an unexpected inheritance tax bill.  

Steven Cameron of pension firm Aegon said: “Pension death benefits aren’t usually treated as part of an individual’s estate for inheritance tax purposes if they are paid at the absolute discretion of the scheme administrator or trustees.