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Inheritance Tax Update

Lump sum death benefit charge

What do you need to tell HMRC?

New guidance has been published by HM Revenue and Customs (HMRC) to help legal representatives find out what they need to tell HMRC to calculate the lump sum death benefit charge.

When someone passes away and their estate includes certain financial products like pensions or life insurance products, any lump sum death benefit received by the beneficiaries might be subject to inheritance tax.

If a lump sum death benefit charge applies to the payout, it could affect the overall value of the estate and potentially impact the inheritance tax liability. Therefore, it’s important to accurately report this information to HMRC to make sure that the overall tax paid is correct.

The new guidance sets out what the legal representative must do and the information they will need to provide to HMRC.

If you need any help with Inheritance Tax or would like to see if there are any planning measures that could mitigate Inheritance Tax on your estate, please contact us on 01384 376 964. We will be happy to help you.

For more information on HMRC’s guidance – CLICK HERE

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Matthew Morris FCCA CTA
Tax Partner
Dan Simpson ACA
Chartered Accountant
Ellie Smith ATT
Jack Taylor

Folkes Worton LLP Chartered Accountants
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