How to declare pension payment adjustments on IHT400/409? 2 June 2022 at 10:36AM in Deaths, funerals & probate 2 replies 111 views

itm2

My mother passed away on April 12th. She had 2 employer pensions:
1. BT - paid monthly in arrears. Final payment was made on April 29th (for the month of April)
2. M&S - paid monthly in advance. Final payment was made on March 31st (for the month of April).

Having declared her bank balance at the date of her death on IHT406, some adjustments need to be made to reflect the fact that
(a) her bank balance at the date of her death would not have reflected the BT pension payment for the month of April (2/3 of which will need to be repaid to BT)
(b) 2/3 of the final payment from M&S will need to be repaid to M&S.
I'm guessing that (b) should be declared in the "other liabilities" box (86) on IHT400? But what about (a)?

SeniorSam

Have you checked that the pensions are not paid in arrears, in which case they are payable?

Don't worry too much about this, you can simply add a note to the documents submitted, which is often done.

Keep_pedalling

You don’t make adjustments to the bank account, that is fixed at the date of death. Any over payment of pensions should be included in box 82 on IHT400 along with any other outstanding bills.

Income received after death is not subject to IHT as it is taxed on the date received. This should be included when you complete the estate’s self assessment form (SA900) to cover any income and dividends received between the date of death and the distribution of the estate.