The following Pensions guidance note Produced in partnership with Wyn Derbyshire of gunnercooke LLP provides comprehensive and up to date legal information covering:
There are two types of scheme benefits payable on a member’s death:
pension death benefits, and
lump sum death benefits
Until 5 April 2015, under the pension death benefit rules of the Finance Act 2004 (FA 2004), s 167, a pension death benefit could only be paid to a dependant of a member if it was to be an authorised payment. The term ‘dependant’ is defined in FA 2004 Sch 28 Pt 2 para 15.
From 6 April 2015, a pension death benefit may be paid not only to a dependant of a deceased member but also to a nominee or successor and still qualify as an authorised payment. The term 'nominee' is defined in FA 2004 Sch 28 Pt 2 para 27A while the term 'successor' is defined in FA 2004 Sch 28 Pt 2 para 27F.
More specifically, the following pension death benefits may be payable:
a dependant’s scheme pension—this is payable from both a defined benefits arrangement and a money purchase arrangement
an annuity—this is payable from a money purchase arrangement only, either to a dependant, a nominee or a successor
a dependant’s drawdown pension—this is payable from a money purchase arrangement only. The dependant must have become entitled to it and have designated sums or assets to a dependant’s drawdown pension fund before
**excludes LexisPSL Practice Compliance, Practice Management and Risk and Compliance. To discuss trialling these LexisPSL services please email customer service via our online form. Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason. Trial includes one question to LexisAsk during the length of the trial.
To view the latest version of this document and thousands of others like it, sign-in to LexisPSL or register for a free trial.
Existing user? Sign-in
Take a free trial
Take a free trial
0330 161 1234