Death benefit

Crowdedhouse_2

Have received a cheque from CWU for death benefit following cousin's death. Is a death benefit just added to the other assets and Inheritance Tax paid on it as estate is over £325,000. Or is it exempt from Inheritance Tax? Thanks.

Yorkshireman99

Crowdedhouse wrote: »

Have received a cheque from CWU for death benefit following cousin's death. Is a death benefit just added to the other assets and Inheritance Tax paid on it as estate is over £325,000. Or is it exempt from Inheritance Tax? Thanks.

The death benefit is only payable if there is insufficient money to pay for the funeral. How did it become payable when the estate value is so high?

jackyann

I think, Yorkshireman, you are referring to death benefit from DWP.
OP used different initials, so I suspect that this is a private insurance, of the kind many people took out to pay for their funerals (before the pre-paid plans became so popular)
As for the question, I don't know - someone may be along who does, or read the small print on the policy, or ring the Probate Office.

Yorkshireman99

jackyann wrote: »

I think, Yorkshireman, you are referring to death benefit from DWP.
OP used different initials, so I suspect that this is a private insurance, of the kind many people took out to pay for their funerals (before the pre-paid plans became so popular)
As for the question, I don't know - someone may be along who does, or read the small print on the policy, or ring the Probate Office.

Fair comment. If so then it forms part of the estate.

Mojisola

Crowdedhouse wrote: »

Have received a cheque from CWU for death benefit following cousin's death. Is a death benefit just added to the other assets and Inheritance Tax paid on it as estate is over £325,000. Or is it exempt from Inheritance Tax?

Was it paid to the estate or direct to you as an individual?

Some insurances pay out directly to the named person and don't become part of the estate - check whether this is the same.

Crowdedhouse_2

I've just checked the letter aunt received.


The letter says 'there is a CWU Death Benefit now due and according to our records you are the nominee for this payment.


Thanks.

Crowdedhouse_2

It was a cheque made out in my Aunt's name. CWU is the Communication Workers Union.

Mojisola

Crowdedhouse wrote: »

I've just checked the letter aunt received.

The letter says 'there is a CWU Death Benefit now due and according to our records you are the nominee for this payment.

This sounds as if it is outside the estate as your aunt has been nominated to receive the money -

https://www.cwu.ie/Services/Benefits-Funds.67.1.aspx
"The estate of a member may be paid €5,080 on his/her death.

A member may nominate during his/her lifetime to whom the sum shall be payable."

Crowdedhouse_2

Many thanks.

Mojisola

Crowdedhouse wrote: »

Is a death benefit just added to the other assets and Inheritance Tax paid on it as estate is over £325,000.

Crowdedhouse wrote: »

Many thanks.

I would confirm it professionally before you get accused of not paying enough tax!

Crowdedhouse_2

Will do! Thanks.