Inheritance Tax Affairs

[cobra kid]

Any chance of some advice from the learned massive?

I will set the scene.

I have just concluded my dads estate after he died back in April. Probate was granted and the monies paid out to me and my brother. The house deeds are in the process of being swapped over as well.

There was a "death in service" pension lump sum payment made from his work that fell outside the probate situation. His overall "probatable" estate was under the inheritance tax figure as well.

My question is - Is this pension payment taxable at all?

Any help would be apprecated.

[cobra kid]

anonymous said:

[redacted]

Me and my brother were named so it came straight to us.

[cobra kid]

Thank you Tonker.

[ukshooter]

The Death in Service payment was never your fathers. It is owned by the pension scheme trustees and is payable at their discretion to anyone nominated by your father on an expression of wish notification. This means that it would not suffer any tax as it would not be paid into your fathers estate. If your father did not complete such a notification, the scheme trustees could choose to pay the money to those they considered the most appropriate (they can also ignore any expression of wish notification and make payment elsewhere).

[cobra kid]

anonymous said:

[redacted]

THAT'S the question!

The money has already been paid to me and my brother.

[Tiggsy]

no.

Payment is cash in your pocket...go spend.

Only tax issue that would ever occur is if pension trustees where idiots and paid money to the estate thus forcing it through probate.....in this case, money came to you direct and free of tax.

[ukshooter]

quote]

THAT'S the question!

The money has already been paid to me and my brother.
[/quote]

As already answered, no tax is due on receiving the money.

However, if you haven't spent the money and it is invested/deposited somewhere, then tax may be liable (income tax, capital gains tax etc). It all depends on the individuals personal tax position and where they keep the money.

Edited by ukshooter on Tuesday 24th November 14:34

[Wings]

anonymous said:

[redacted]

Surely not about income tax Tonker, more about IHT, and that depends if the OP’s father made careful planning prior to his death.