Dependants' annuity definition

View the related practice notes about Dependants' annuity

Death benefits—money purchase schemes

FORTHCOMING DEVELOPMENT: The Office of Tax Simplification (OTS) has released a report outlining recommendations to make considerable aspects of the design of inheritance tax (IHT) simpler, more intuitive and easier to operate. One of the recommendations is that the government should consider ensuring that death benefit payments from term life insurance are IHT free on the death of the life assured without the need for them to be written in trust. In relation to pensions, the OTS says that IHT could similarly be simplified by changing the current anomalous position under which some pension policies can be included within an estate for IHT purposes while other comparable pension savings, set up under discretionary trust, are not. The OTS notes that in relation to defined contribution pensions, the main reason discretionary trusts are currently used to provide death benefits is to keep such pension savings outside IHT. For more information, see: OTS Inheritance Tax review: Simplifying the design of the tax, Chapter 6, pp 52–55.THIS PRACTICE NOTE APPLIES ONLY TO REGISTERED MONEY PURCHASE OCCUPATIONAL PENSION SCHEMESMost pension schemes provide for benefits upon the death of the members. What those benefits will be depends on:•the type of scheme and what benefits it provides—different death benefits are available depending on whether the scheme is a money purchase scheme or

Using the National Employment Savings Trust (NEST) for auto-enrolment

In this Practice Note, references to the National Employment Savings Trust (NEST) Order are to the National Employment Savings Trust Order 2010, SI 2010/917 (Nest Order) applicable from 25 May 2018. References to the NEST Rules are to the Rules of the National Employment Savings Trust applicable from 9 September 2019.What is NEST?NEST is a pension scheme established under the authority of the Secretary of State under section 67 of the Pensions Act 2008 (PenA 2008) and the NEST Order, SI 2010/917, as a vehicle that employers may utilise in order to meet their auto-enrolment obligations. NEST was created specifically to ensure that smaller companies and low-to-moderate earners have access to quality pension provision.This Practice Note sets out the key aspects of NEST.For further information on the auto-enrolment obligations, see Practice Note: Auto-enrolment—the requirements.An employer may prefer to use NEST to meet their auto-enrolment obligations:•to reduce the administrative burden (as an employer would generally just need to enrol employees and pay contributions)•as a single scheme solution to auto-enrolment with greater simplicity and less administrative cost (particularly for smaller employers)•where they operate in an industry that has a high turnover of workers (so as to smooth the process when employees