PSI17.2.52 - Tax Treatment of Approved Schemes
and Payments by Approved Schemes: Taxation of Payments to Scheme
Members - Inheritance Tax - Payment of Benefits
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(This archived guidance relates to HMRC discretionary
practice before the 6th April 2006. For current guidance on
Registered Pension Schemes see the Registered Pension Schemes
Manual)
Death benefits (including pensions) payable under the scheme
rules are liable to IHT only if:
- they are payable to the member’s
legal personal representatives, or
- the member could nominate a beneficiary.
(But if payment of benefits is subject to discretionary
distribution by the trustees despite such a nomination there is no
liability to IHT).
In these situations the death benefit payable is part of the
deceased’s personal estate, and the tax is payable by his or
her legal personal representative.
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