Under rules announced in the October Budget, pensions will no longer be exempt from death duties and will instead face a levy of up to 40%.

The change is expected to more than double the number of estates dragged into IHT, with the share rising from around 4% today to almost one in ten (9.7%) under Labour.

On top of this, Ms Reeves is said to be weighing up a fresh grab by introducing a lifetime cap on gifts made before death – a move likely to alarm middle-class families trying to pass on their savings.

Inheritance tax is currently charged on estates above £325,000 – the so-called “nil-rate band” – with a further £175,000 allowance if the family home is left to direct descendants.

But in London, where average house prices are far higher, the impact will be brutal. Someone owning a typical home worth £565,637 alongside a £415,000 pension would be hit with a tax bill of £192,254, according to wealth manager Quilter.

Adding to the squeeze, Rightmove predicts house prices in England will rise another 4% in 2025, pushing even more estates into the tax trap.

Pensions experts warn that the reforms are particularly harsh because families will be taxed even if their loved one dies before being allowed to draw down savings at the age of 55. At present, pensions can be passed on tax-free if the saver dies under the age of 75, up to a limit of £1.07million.

The Treasury has insisted the new rules will raise around £1.5billion a year by 2029-30. But critics say the raid will devastate bereaved families.