Pensions: alternatively secured pension (ASP) between 6 April 2006 and 5 April 2007: procedure when an ASP charge arises: death of relevant dependant other than under IHTA84/S151B - charge under IHTA84/S151C
Where a scheme member dies under age 75 (and was therefore entitled to benefit from an Unsecured Income fund rather than an ASP) a charge to Inheritance Tax will arise on the funds if the dependant dies aged over 75 and is in receipt of income from an ASP purchased with the inherited funds.
The charge is on the same basis as the IHTA84/S151A charge and the funds are aggregable with the dependant’s estate, although no charge will arise to the extent that the funds are paid to charity within the 6 months. Scheme administrators are responsible for delivering the appropriate account and paying any tax that is due.
No further charge can arise once the funds have been taxed on the dependant’s death so the file may be closed in the normal way with no need for future review.