A deceased individual’s omission to take lifetime pension benefits fell to be treated as a transfer of value for inheritance tax purposes, but the transfer of funds from one pension policy to another did not give rise to an inheritance tax charge. 

Summary 

A deceased individual’s omission to take lifetime pension benefits fell to be treated as a transfer of value for inheritance tax (IHT) purposes, but the transfer of funds from one pension policy to another did not give rise to an IHT charge. 

Background 

The deceased (RFS) was diagnosed with cancer, and in October 2006 was advised that her prognosis was terminal. On 3 November 2006, RFS applied for the funds from one pension scheme (‘section 32 policy’) to be transferred into another (‘PPP’). She completed an expression of wishes