PENSIONS AND INHERITANCE TAX
In April 2027 any unused pension funds belonging to a deceased and pension death benefits will need to be valued and included within an estate for inheritance tax purposes regardless of whether the pension scheme administrators have discretion over the payment. The pension scheme administrators will need to provide the Executors of the Will (or Personal Representatives if there is no Will) with the value of such pensions and the Executors/Personal Representatives will be liable for reporting and paying any inheritance tax. However, they will be discharged from liability for any pensions discovered after they have received clearance from HMRC for settling the Inheritance Tax due on the estate, provided that HMRC are satisfied that they have made every effort to locate the deceased’s pensions.
A mechanism will be introduced by the Government for Executors/Personal Representatives to direct pension scheme administrators to withhold any benefits and to pay Inheritance Tax due on any unused pension funds or death benefits.
However, death in service benefits payable from a pension scheme and dependent’s scheme pensions from a defined benefit arrangement are excluded from these changes.
If you need any advice or assistance with an estate, then please contact us.
CXG
Senior Qualified Paralegal
Christine Gee has over 40 years’ experience in the law but has specialised in Wills and Probate for the last 23 years having gained a Specialist Paralegal Diploma in April 2000. Christine is based at our Sawston office and can also visit clients at home, or via telephone or remote video meeting. Christine is able to assist with Wills, Lasting Powers of Attorney, Probate and Estate Administration and Court of Protection Deputyship Orders.
Hobbies and Interests: When not in the office Christine enjoys reading, painting (occasionally!) and spending time with her dogs.
