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HMRC internal manual

Inheritance Tax Manual

HM Revenue & Customs
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Pensions: IHT charges: Contributions generally

Generally, when a person makes a contribution to a pension scheme, they do not make a transfer of value because the pension rights they acquire by making the contribution are within their estate.

There are two situations where contributions may result in a lifetime transfer;

  • the transferor contributes to their own pension scheme whilst in ill-health and the death benefits are payable outside the estate (IHTM17043), or
  • the transferor contributes to a pension scheme for someone else (IHTM17044