Pension funds at death

Updated on 31 March 2018

This section explains what happens to UK pensions that were payable to a pensioner at the date of their death. None of the sums that are discussed here are liable to inheritance tax, provided that the lump sums are payable at the discretion of the pension scheme trustees.

Will I receive part of my partner’s state pension now they have died?

The first thing to be aware of is that only a bereaved spouse or civil partner may receive any state benefits based on the bereaved person’s National Insurance contributions. You can read more about inheriting rights to a state pension in our section on ‘Death of a spouse or civil partner’.

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What happens to other pensions they were receiving when they died?

This depends on the type of pension they were receiving.

If they had bought an annuity with their pension funds, the annuity might stop being paid, or it may continue for a period of time, or may be paid to a nominated beneficiary, possibly at a reduced rate. If the person died before age 75, then any further payments from the annuity will be tax free (assuming the death was after 3 December 2014 and no payments were made before 6 April 2015). If the person was aged 75 or over, then any lump sum will be taxable at the recipient's marginal rate of income tax while any income would be taxed at the recipient’s income tax rates.

If they were making flexible withdrawals from a defined contribution pension scheme, then the remaining part of the ‘pension pot’ may be accessed by the nominated beneficiaries. As above, the tax treatment of any such payments depends on the age of the deceased.

If they were receiving a pension from one of the armed forces pension schemes, then a pension may be paid to their widow, widower, surviving civil partner or surviving cohabitee. Such income payments will be liable to income tax, while lump sum payments will not be. You can read more about this in the section ‘Pensions paid to widows, widowers and dependants.’

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My partner died before being paid their pension. Am I entitled to anything?

This depends on the pension scheme that your deceased partner was a member of. You should contact the trustees of the relevant pension scheme. For the armed forces pension schemes you should contact Veterans UK. You can also read more in our page ‘Pensions paid to widows, widowers and dependants’.

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Where can I find more information?

For information on pensions generally, you can find information on the Pension Wise website or in our ‘Tax basics’ section.

For information on the state pension, see GOV.UK.

For information on armed forces pensions, see Veterans UK or GOV.UK.

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