In this week's pensions and retirement Q&A, Jasmine Birtles answers a question on inheriting pensions
Question: "My husband died aged 62 in January 2016 and had worked all his life. I'm 66 in December this year and it looks like I will receive the full pension amount. Can I also inherit any of his pension?"
Jasmine Birtles is GBN Membership's money expert. Got a question you'd like her to answer? Email money@gbnews.uk.
Jasmine replies: I’m so sorry to hear about your loss. I do hope you can have some of your late husband’s workplace pension but it does depend on the pension plan and what he signed up for when he was alive.
Mike Ambery, Retirement Savings Director at Standard Life, part of Phoenix Group explains: “The rules around inheriting a spouse’s state pension are complex and we’d recommend you speak to the Pension Service about your situation.
"As you are reaching state pension age after 6 April 2016, you will receive the ‘new’ state pension and you might be able to inherit up to half of your husband’s 'additional' state pension or ‘protected payments’.
“The rules around inheriting your husband’s private (company or personal) pension depend on whether he paid into a defined contribution (DC) scheme, in which the pot was built up by contributions made by your husband and his employer, or a defined benefit (DB) or ‘final salary’ scheme which offered a guaranteed income for life.
“For a DC scheme, you can inherit any unspent money left in the pot at the time of your husband’s death.
"If you were down as the beneficiary on the plan, this should be a straightforward process. If there are no beneficiaries on the plan, the pension company is responsible for making this decision but will take important factors like marital status into account.
"Pensions also currently sit outside your estate, so they are also not liable for inheritance tax.
"If your husband had bought an annuity, you can’t inherit the pot in the same way however if he chose a ‘joint-life’ annuity you should still receive income from it.
“If part or all of your husband’s private pension money was in a DB pension, there’s no pension pot as such to inherit however your husband’s scheme may have made provisions for spouses and other dependents but this will depend on the individual scheme rules.
"It’s worth contacting your husband’s former employer or pension scheme administrator to find out.
"You might also be eligible for lump sum payments from certain types of pension arrangements your husband may have had, and it’s worth checking this with his most recent employer.”
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So I suggest that, as Mike says, you first speak to the Pensions Service, and then contact the company that your husband worked for to get information from them.
You will probably need his date of birth and National Insurance number when you speak to them so get that paperwork out first.
If it all seems a bit much for you to deal with yourself, see if you can get someone to help you with it at Age UK or Citizen’s Advice Service.
You might have to wait for a volunteer to become available but it can help to have someone who knows what they’re doing helping with the form-filling!
Jasmine Birtles is a personal finance expert, TV and radio presenter and author of 38 books. Her website, MoneyMagpie.com, covers all aspects of personal finance from money-saving and money-making ideas to investment and pensions information. She is a keynote speaker at conferences around the world.
