No funds in the estate how do i inform creditors?

Sirlaughalot

Linton wrote: »

Recent widows/widowers have no special income tax allowance considerations. But I cant see why that information should be of any relevence to an executor. Why do you need to assume anything?

My Sil has a couple of pensions being left to her by her late husband. She has cashed in the smaller one as she thinks she will need the cash when her daughter finishes her first-degree course at the university in two years time. The second pension together with her NHS nursing salary takes her close to the high tax band of 40% (£45001). I was wondering if there may be allowance as she is now a widow but you have answered that now.

Many thanks and i hope this explains my question as generally a widows pension does involve someone's death and this could be a question associated with the executor of the estate allied to that death

Sirlaughalot

My Sil has also benefitted from the bereavement allowance thanks to the advice given by MSE members. It has been paid in the form of a one-off payment and monthly payments for 18 months if my memory is correct. For tax purposes would this be classed as taxable income?

I say this because the pension which she cashed in has been classed as income and a P45 document accompanied the payment. Once again i`m worried that these payments may take her income over the high tax threshold and the problems that this may cause

Thanks in advance

Linton

Sirlaughalot wrote: »

My Sil has a couple of pensions being left to her by her late husband. She has cashed in the smaller one as she thinks she will need the cash when her daughter finishes her first-degree course at the university in two years time. The second pension together with her NHS nursing salary takes her close to the high tax band of 40% (£45001). I was wondering if there may be allowance as she is now a widow but you have answered that now.

That is a different question! Nothing to do with tax allowances: An inherited pension pot can be completely tax free. See https://www.gov.uk/tax-on-pension-death-benefits

Sirlaughalot

Trivial commutation i remember reading that in the letter that accompanied the P45/pension payment so i hope the tax has already been paid by the provider so it will not eat into her personal tax allowance. Not a problem for this financial year as she was caring full time (5 months) for her husband up to the point of his death and her income was basic pay only