DEATH BENEFITS

Question 1

Death after Retirement

Answer 1

Rules of scheme set out benefits provided on death

Guarantee period paid for a defined minimum period of up to 10 years. Full scheme pension paid to dependants. Taxable at Beneficiaries pension income under PAYE

Spouse and Civil partners Pension
Usually a fixed percentage based on pension would have received if not commuted for lump sum also taxable as recipients pension income under PAYE

Question 2

DEATH IN DEFERMENT

Answer 2

Some schemes will pay a return of contributions sometimes only if no dependants

Some DB closed to future accrual moved to DC schemes so may still have lump sum Death in Service Benefit

Defined Benefit lump sum Death Benefit if still working is paid to beneficiaries
If paid before 75 any excess over LTA charged at 55%

May only be Survivors pension generally 50% paid to spouse or civil partner and their children

Children’s pension generally percentage of spouses pension paid until 18 or 23 if in full time education

Question 3

WHO IS A NOMINEE AND WHO IS A SUCCESSOR

Answer 3

A nominee is an individual nominated by the member or the scheme administrator who is not a dependant. The scheme administrator can only nominate an individual where there is no surviving dependant, individual or charity nominated by the member.
A successor is an individual nominated by a dependant, nominee or successor of the member, or by the scheme administrator. The scheme administrator can only nominate an individual where there is no surviving individual or charity nominated by the beneficiary.