Early life insurance payout terminal illness

My husband and I had a joint life insurance policy for £100k which has just paid out due to his terminal diagnosis, we wanted to clear some debts, get the house sorted, just make everything easier for him etc.,

Is there any tax to pay on a early life insurance claim? They are sending a R185 form in the post but I don't really understand what this is for?

We have no other savings. I'm his carer so not working and not currently paying tax.
The house is still in his name at the moment, we just never got round to getting it put into both names when we married 30 years ago.

Could anyone tell me if there will be any tax implications on this insurance payout now or in the future and whether the house being left to me will cause any issues (it's worth approx £400k) or is it better to get it put in joint names now?


  • DullGreyGuy
    DullGreyGuy Forumite Posts: 6,336
    1,000 Posts First Anniversary Name Dropper
    No tax to pay on the payout. IHT will depend on the size of the estate (factoring in gifts etc) and who the beneficiaries are. Assuming it was all left to you and you are married (as the husband comment would suggest) then there'd be no IHT
  • Weighty1
    Weighty1 Forumite Posts: 1,157
    Eighth Anniversary 1,000 Posts Name Dropper
    From the sounds of it, the main implication is likely to be how it impacts means tested benefits, however, this can be quite a commplex subjecct and it's not one which I am an expert in.

    Best wishes with the future months and may they be as easy on you both as possible.
  • Chaletgirl4
    Chaletgirl4 Forumite Posts: 4
    First Post
    Thankyou both
  • Misslayed
    Misslayed Forumite, Senior Ambassador Posts: 13,338
    Eighth Anniversary 10,000 Posts Name Dropper Photogenic
    Senior Ambassador
    I've been there @Chaletgirl4, and I wish you strength for the time ahead. 

    Just in case you don't know about these things - with a terminal diagnosis you can be fast tracked through a PIP (or Attendance Allowance if past state pension age) application, same for a blue badge. You may also be able to get a reduction in your council tax. 
    I’m a Senior Forum Ambassador and I support the Forum Team on the Competition Time, Site Feedback and Marriage, Relationships and Families boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing [email protected] All views are my own and not the official line of Money Saving Expert.
Meet your Ambassadors


  • All Categories
  • 338.9K Banking & Borrowing
  • 248.7K Reduce Debt & Boost Income
  • 447.6K Spending & Discounts
  • 230.8K Work, Benefits & Business
  • 601K Mortgages, Homes & Bills
  • 171.1K Life & Family
  • 244.1K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards