Early life insurance payout terminal illness

Chaletgirl4

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

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

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

Thankyou both

Misslayed

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.