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Private Pension After 75 - Grandchildren as Beneficiaries
se_yp
Posts: 43 Forumite
Hi all
Hopefully a simple query, I've searched online and on this forum but couldn't quite get the answer to my specific question.
If a person over the age of 75 puts their grandchildren as the beneficiaries of their SIPP; after they pass is there any income tax the grandchildren need to pay (assuming they are under 16 and not working / dont have any income). I'm not sure if under 16's have a £12,570 tax free allowance and if they'd be eligible to take 25% tax free if any tax is due.
Would the under 16's even be able to access this money or is it more complicated than that.
Thank you
Hopefully a simple query, I've searched online and on this forum but couldn't quite get the answer to my specific question.
If a person over the age of 75 puts their grandchildren as the beneficiaries of their SIPP; after they pass is there any income tax the grandchildren need to pay (assuming they are under 16 and not working / dont have any income). I'm not sure if under 16's have a £12,570 tax free allowance and if they'd be eligible to take 25% tax free if any tax is due.
Would the under 16's even be able to access this money or is it more complicated than that.
Thank you
0
Comments
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If you die after age 75 there is no tax free cash in the residual pension. Any funds will be drawn at the recipients marginal tax rate. Everyone has a £12570 personal allowance regardless of age (bar higher earners or donators/ beneficiaries of marriage allowance).
In a nutshell there is no issue with leaving your pension to grandchildren.I am an Independent Financial Adviser. Any comments I make here are intended for information / discussion only. Nothing I post here should be construed as advice. If you are looking for individual financial advice, please contact a local Independent Financial Adviser.0 -
Thank you. If the grandchildren are under 18 (considered minors) are there any caveats such as they'd need to wait until 18 before being able to access the funds etc. I recall seeing something about it having to be put into a trust until they became an adult.0
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No it is available for them to access. It may need a guardian to request funds but they are available from day one.I am an Independent Financial Adviser. Any comments I make here are intended for information / discussion only. Nothing I post here should be construed as advice. If you are looking for individual financial advice, please contact a local Independent Financial Adviser.1
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