pension on death

simpywimpy

Just found a pension letter for an estate I am helping sort out and it states that if you die before you use the fund we 'may' pay out the pension value or the contributions to date.

The pension holder was 59 at death and hadn't gone into payment though she could have done at 55 it seems. The pot is worth £9800. Should her beneficiary be able to claim this amount?

kidmugsy

Had she completed the pension company's form that named her preferred beneficiary?

simpywimpy

I don't know, all we have found so far is the annual statement. I wrote off yesterday asking for the funds and enclosing the death certificate

Linton

The pension holder should have filled in a form stating who they would like to receive the money when taking out the pension. The final decision as to who should receive it lies with the pension trustees,. It doesn’t normally go into the estate and so distribution isn’t the direct responsibility of the executor.

simpywimpy

I have had a response from the pension company and they have sent a form to complete which it says will then be passed to the relevant department to look into.
Am I right in thinking it looks like there was no listed next of kin on the pension by them sending out the form?
The deceased will only states her son as beneficiary and I am going to send a copy with the form as requested.

Any thoughts please?

kidmugsy

If she didn't complete a form for the company your decision to send a copy of her will sounds wise to me. Note that if the company pays out to her son that money is not part of her estate because it is, strictly, paid at the discretion of the trustees of the pension scheme. Your sending in the copy of the will lets the trustees make their decision in an informed manner.

simpywimpy

If he does receive it (its just under 10k) and she was due to access it herself 10months following her death, would the beneficiary pay tax on it?

Linton

simpywimpy wrote: »

If he does receive it (its just under 10k) and she was due to access it herself 10months following her death, would the beneficiary pay tax on it?

In the circumstances you describe, no, provided the money is transferred with 2 years of the pension owners death.

See https://www.gov.uk/tax-on-pension-death-benefits