Death in service benefit

M

misstealeaf

Registered User
Messages
93
My dad passed away and under his pension there was a death in service benefit payable. As part of his will the house was to be left to my mam with everything else to me. My mam obviously is the beneficiary of the widows pension from his job so we are wondering if she is the beneficiary I of the death in service benefit albeit the will says I'm to get everything other than the house. Our solicitor says it needs to be paid to me altho I don't think he's great so wanted to ask the question here. Thanks
 
I'm not sure Death in Service lump sum is part of the "estate to be distributed" The way I understand it is that I ts pretty much similar to an insurance policy where a beneficiary is typically named. If your dad had an insurance policy would the solicitor say you should be the beneficiary.

A member can declare who is the beneficiary of their Death in service benefit and it is common for a nomination form to be given to new scheme members. In the absence of this the trustees of the scheme would normally pick who it should be paid to and normally that would be a dependent ie a spouse, child etc. the members wishes or perceived wishes will be taken into account. They can apportion it as well.
 
Thanks Peno. I was speaking with the pension administrators and there is no suck nomination in place so it seems it forms part of the estate.

Under the will I'll have an inheritance from 4 sources- my dad's savings, death in service, life assurance policy and a critical
Illness insurance policy. Do you know if all these 4 will be subject to inheritance tax and will they all be counted in the 225k threshold. I thought I read somewhere that insurance policies are excluded but I'm not sure????? Thanks
 
i think you need professional tax advice on this as i'm not knowledgable to comment on that.

however i do believe insurance is tax free - death in service to a spouse is tax free subject to a limit - 4 times salary I think but could be wrong. not sure how it applies to a son/daughter.

again though I'll ask the question - on the life assurance who was the named beneficiary? Where you the named person or your mother?

Also despite what the solicitor says do you think your father expected the insurance and death in service to go to you or your mother? That is what the trustees will conside for the death in service benefit. They will take a will into consideration but if it is ambigious they will come to their own conclusion on what they think the member wanted. Have you had again contact with the trustees or their opinion.

Insurance/death in service is normally there to provide for dependants when a person passes away. It is not normally left behind for inhertance similar to other assets.

Is there any family issues/dispute here?

Sorry for asking these perhaps insensitive questions but I just find it strange that insurance is left to you unless you were a dependant of some description.
 
Hi Peno.

No there is no family dispute. I am an only child and my parents lived apart albeit were still married. They structured their will so that the family house would be left to each other but all other finances were to be left to me. Hence the will was phrased this way and by default anything that falls into the estate is going to me. There was no named beneficiary on any of the insurance policies. I think uou are right though and that i need to get proper tax advice on all this. Thanks
 
You must log in or register to reply here.
Back
Top