Autumn Statement 2014: Pensions ‘death tax’

The Autumn Statement confirmed the removal of the 55% ‘death tax’ applying to pension funds. This change was first mooted when pension flexibility was announced at Budget 2014 and has been the subject of recent announcements (see our article ‘Pension ‘Death Tax’ Abolished From 2015/16).

Instead, from April 2015, no charge will apply to death benefits where the member dies before the age of 75. From the same date, where death occurs on or after 75 the charge will be at the beneficiary’s marginal tax rates or 45% if a lump sum is taken (with a marginal rate charge applying from 2016-17).