Pension: What happens to your pension when you die?

State Pension is a Government benefit for retired Britons, although advantages depends on age of the pensioner and contribution record. Anyone who has worked a minimum number of qualifying years in the UK can claim the retirement scheme. But what happens to your pension when you die?

What happens to your pension when you die?

Normally the value of your pension pot will be paid at your date of death.

This amount can be paid as a tax-free cash lump sum provided you are under age 75 when you die.

The value of the pension pot may instead be used to buy an income which is payable tax free if you are under age 75 when you die.

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If the person who died was getting a State Pension, you should tell the Pension Service that he or she has died so that payments stop.

Call the Pension Service helpline on 0800 731 0469.

Pensions Advisory Service explained: “Depending on when you reached or will reach your State Pension age, when you die, some of your State Pension entitlements may pass to your widow, widower or surviving civil partner.

“If you die, your widowed husband, wife or civil partner may also be able to claim bereavement benefits.

“A new State Pension system was introduced as of April 6, 2016.

“The benefits payable on your death will depend on when you or your partner reached or will reach their State Pension age.

“There will be transitional arrangements, so that in some circumstances, people who have made national insurance contributions or have credits under the current system will still be able to inherit state pension from a late spouse or partner.”

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Can you claim your partner’s State Pension?

Depending on the amount of National Insurance contributions your partner made when you reached the State Pension age, you may be entitled to extra pension payments.

If you’re dealing with someone’s affairs after their death, you should check their paperwork to see if they had any personal or workplace pension schemes.

If they did, contact the pension provider to find out how much they had and what to do next.

If you haven’t reached State Pension age, you might also be eligible to claim Bereavement benefits.

Bereavement benefits are for people whose husband, wife or civil partner has died. Which benefits and how much you qualify for will depend on:

  • your age
  • whether you have dependent children
  • whether the person who died paid enough National Insurance Contributions during their working lives

How much is Bereavement Support Payment?

Bereavement Support Payment is paid at either a higher rate or standard rate:

Higher rate

Paid to pregnant women or if you’re entitled to Child Benefit. You’ll get:

  • a monthly payment of £350 for 18 months following the death
  • a one-off payment of £3,500 during the first month

Standard rate

For everyone else. You’ll get:

  • a monthly payment of £100 for 18 months
  • a one-off payment of £2,500 during the first month

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