Pensions, Wills and the Terminally Ill

meg00

I have a friend who has very recently (and unexpectedly) been diagnosed with a terminal illness. She is in the process of organising a will, while she still has her mental faculties. She has a good pension from the public sector, but is worried that it may be lost unless she marries her long term partner.
I thought that as long as she has made a will, her pension provision becomes part of her estate, and can be bequethed to whomever she chooses - however I am not certain.
We are in the process of getting a solicitor to visit her in hospital, but this won't happen until next week and she would like to start a rough draft ASAP.
It is in the nature of the illness that she could lose some/all of her faculties without warning, so she is desperate to know where she stands with her pension. Any advice would be gratefully received.
She has no children, just a partner and 2 siblings.

xylophone

Has she contacted the Pensions Administrator concerning her Expression of Wishes? This type of thing http://www.buckscc.gov.uk/media/133120/expression_of_wish.pdf

dzug1

With most public sector schemes a single person's pension is lost on death - there is nothing to leave in a will.

There would be a death benefit - payable to whoever has been nominated to receive it or at the discretion of the scheme managers if no nomination has been made.

If she were married a widower's pension would be payable

meg00

She can't speak to anyone, tumour on vocal chords & trachea tube in. Communicating via tablet. Internet access at hospital very slow and unreliable, hence the urgency to get solicitor in.
Hasn't contacted anyone yet, illness and diagnosis very sudden, she was hospitalised immediately.
I will check out the link.
Many thanks for your swift response.

meg00

I think she is a member of UNISON. Would they be able to help?

Torry_Quine

meg00 wrote: »

I think she is a member of UNISON. Would they be able to help?

Definitely contact UNISON they will be able to help re pension allocation details and may have a lawyer who can see her in hospital.

meg00

Can she nominate a beneficiary for the death benefit in her will, or does it have to be on the nomination form?

Torry_Quine

meg00 wrote: »

Can she nominate a beneficiary for the death benefit in her will, or does it have to be on the nomination form?

Pensions tend to fall outside a person's estate and so the nomination is via the provider.

meg00

Thanks Torry, will do that.

xylophone

The nomination form should be used. See form above.

"Taxation of Estates
Under HM Revenue & Customs (HMRC, formerly known as Inland Revenue) rules, estates
are taxable above a certain limit. By making a nomination, HMRC may consider the death
grant to be excluded from your estate, which may avoid or reduce the liability for Inheritance
Tax."

In view of her condition, perhaps her next of kin/solicitor could contact the Administrator on her behalf as a matter of urgency?

Tosca3

The lump sum can be paid out before death if you are diagnosed with a terminal illness, which is about 3 or 4 times your last annual salary. I put in the application and a Doctor representing the LGPS saw my husband within 3 days and payment was received about 10 days later.

The nomination form meant everything was sorted out very swiftly with regards to pensions after his death. I actually can't remember doing any paperwork apart from nominating a bank account for the money to go into.

Just for info he was a deferred member of a Local Government Pension Scheme and all this happened in October last year, just in case rules have changed.