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Saving into a pension

Dependants’ benefits

If someone close to you dies, you may be eligible to receive a pension from their pension scheme.

If you were financially dependent, or interdependent, on someone who has died, you may be eligible to receive ongoing pension payments from their pension scheme.

You may be a dependant if you're:

  • their spouse; or
  • their civil partner; or
  • one of their children that is still dependant e.g. in full-time education and under the age of 23
  • anyone else who was financially dependent on them.

The amount you could receive depends on a number of factors, including whether the member was an active member, had left the scheme or was already drawing retirement benefits. You should speak to the scheme’s administrator or pension provider to find out what you could receive.

Dependants’ pensions are paid in line with the rules of your pension scheme or the terms and conditions of your policy. Each scheme has different rules and processes so it's important to check what you are eligible to receive and any forms that you may need to complete. They are also treated as income for income tax purposes.

Defined benefit schemes

  • On the death of a member in a defined benefit pension scheme, the scheme may pay a pension to a surviving spouse, civil partner or other dependent adult. They may also pay a pension to any children until they leave full-time education. Often, dependants’ pensions are paid at a lower rate than the member’s entitlement under the scheme.
     
  • If the member had already started drawing retirement benefits from a defined benefit pension scheme before they died, the scheme will usually pay an ongoing pension to a surviving spouse, civil partner or other dependent adult. They may also pay a pension to children until they leave full-time education.

 

Defined contribution

  • On the death of a member in a defined contribution pension scheme where the benefits have not been taken, the scheme normally pays a lump sum to dependants. They can decide to use the lump sum to provide a regular income instead.
     
  • If the member had already started drawing retirement benefits from a defined contribution pension scheme before they died, the options selected when they bought an annuity will determine whether dependants receive anything further. If the member has opted for income drawdown, the benefits will be a lump sum less tax of 55% or a dependant’s pension, which is taxed as income.

 

Frequently asked...

Where can I find out more?

If you need more information, please contact us. A pension specialist from our team will be happy to help with any question you might have. Our help is always free. 

Where can I find out more?

If you need more information, please contact us. A pension specialist from our team will be happy to help with whatever pensions-related question you have. Our help is always free.

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