Death Benefits

Death before taking benefits

If you die before you have taken your benefits, then the value of your SIPP fund (and all other pensions they may have) will be tested against the Lifetime Allowance. If the Lifetime Allowance is exceeded, then a tax charge will be applied to the excess (unless the member has the necessary protection).

Death benefits are then paid to your nominated beneficiaries. The options are as follows:

  • The whole value of your fund can be paid tax-free to the nominated beneficiaries
  • The whole fund can be used to pay dependants' pensions, which will be either:
    • a dependant's unsecured pension if the dependant is under age 75
    • a dependant's alternatively secured pension if the dependant is over 75
    • a dependant's annuity