Categories: Investing, Pensions, PlanningTags: , , , , 1.1 min read

Your pension is your asset, just like any other, So it’s reasonable to expect that when you finally shuffle off this mortal coil, your pension doesn’t shuffle along with you, landing squarely in the tax man’s pockets.

Normally, in order to pass a pension on, it would be a flexible access Scheme. If you’ve transferred your pension to a QROPS or SIPP then this should be the case.

If you, unfortunately, pass away before the age of 75, your dependants or nominated beneficiary could:

  • Continue with the pension as is.
  • Take what’s left as a lump sum.
  • Or purchase an annuity with it and secure an income for the time period of the annuity.

If you die after the age of 75, the rules change slightly, in this case, your beneficiary could :

Continue with the pension

Take the pension as a lump sum, however, this will be subject to income tax at their marginal rate.

Or Again, buy an annuity

Pensions fall outside of your estate for IHT purposes, However, depending on the type of transferred Pension you have, and your beneficiary’s location, will depend on the tax treatment of the choices they make.

Let us help

For clarity on this or any other aspect of your pension, complete our pension questionnaire, and we’ll be happy to guide you.

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