TAX ON PENSIONS

Moreen

Registered User
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Can anyone help me. 2 years ago, my dad passed away leaving no will. We found some pension policies. Dad was made bankrupt in 1995. It took two year for the Official Receiver to reply to the Insurance Cos to say if they had an interest in the policies. We had to make a complaint and the Official Receiver's reply due to the complaint was that he had no interest in any policies. We did not go for probate during this time as dad had little money in his Building Society and were not sure if probate would be needed seeing that the policies were not protected. Anyhows, it has since come to our attention that because no claim was made within 2 years of my dads death, we have now to pay 55% tax. There is a Approved Occupational Pension Plan, with 2,142. A small life policy of 5894 sum assured. An approved Retirement Annuity Contract of 12,493.89. The money will pass to me and my sister as dad did not name the beneficiaries on his policies. It was not our fault if the tax is due.. is there anyway of avoiding this... does anyone know? please help. Thank you.
 
I never heard of that 55% tax rule. But then again, I have never come across a claim not being made within 2 years.

Uusally, the RAC will go to the estate tax free. The occupational scheme pays out 4 times salary as a lump sum and the remainder is used to purchase an annuity. As it is only €2k, I presume it would be paid as a lump sum.

It may not be your fault the tax is due but if that 55% rule is there, you have to pay it. Maybe some of the tax experts on here can shed more light on it. It's more of a tax issue than a pension one.

Steven
www.bluewaterfp.ie
 
Thank you Steven, I thought I was unsure whether to put it under Pensions but as I am not an expert re pensions thought someone on here may be able to shed light on the tax side of things.
 
The Building Society... said that as we did not apply for probate that if the money was not claimed within 2 years we have to pay HMRC 55% tax. We knew nothing of this until recently... said if we were to go for a grant of probate this could have been avoided but we were also told that because the policies were 'unprotected' as dad was a bankrupt then the money would go to the ORs as there was an interest in one of the policies... they tried for two years to get an answer and when we made an Official Complaint to them they wrote back saying they had no further interest... I cant see how this is fair though as we were also told by the probate office that there was no time limit as to when we should apply for probate, so we were clutching at straws hoping the OR would not take all of them. We knew nothing of this rule on pensions until a letter came advising us of this.
 
Hi Moreen,

This is an Irish website.

You might find a British equivalent of more assistance to you.
 
Oh!!! Apologies, I didn't realise .... thank you for telling me! And me being Irish too..Thank you again.
 
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