In certain situations in pension schemes and subject to the
exact terms of the scheme rules a policyholder has a
‘right’ to request ill health retirement. That right in
certain situations can amount to the commuted value of the whole
pension fund (in effect the policyholder can get the full cash
value of their fund in a tax-free lump sum).
Any case in which the conditions for ill health retirement
appear to be satisfied but the deceased died without exercising the
right to request ill health retirement could give rise to a claim
for a lifetime transfer (
IHTM14000) under IHTA84/S3 (3) and
should be referred to TG in IHT Edinburgh. Where appropriate the
pension specialist in TG will take up the possibility of a claim
under S3 (3).
