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HMRC internal manual

Inheritance Tax Manual

Pensions: treatment of alternatively secured pensions from 6 April 2007: the Inheritance Tax position on pension scheme rules for members who cannot be traced

Those whom a scheme cannot trace at age 75 (IHTM17450) are brought within the Inheritance Tax framework by IHTA84/S151A(6). The value of the remaining funds on death of the scheme member will be treated a part of their Inheritance Tax chargeable estate in the way established for ASP funds under IHTA84/S151A-C. Where the fund is paid as pension benefits to a relevant dependant any IHT charge on any remaining funds will be deferred to the date of cessation of those pension benefits. Funds paid to charity will be exempt.

Where there is an unauthorised payment charge on the remaining funds the mechanics of the IHT charge will work in broadly the same way as described in IHTM17403.

Scheme administrators will be liable and accountable for any Inheritance Tax. In these cases schemes may not be aware of the death of a scheme member until long after the event so instead of the usual Inheritance Tax time limit for delivering an account the scheme administrator will have six months from the end of the month in which they in which they were notified of the death to meet their accounting obligations under IHTA84/S151A(6).