UK Pensions: beware inheritance tax on pension transfers made shortly before death

In a recent UK case (HMRC v Parry) the Court of Appeal found that inheritance tax was due on pension benefits which were transferred out of a defined benefits (or final salary) to a defined contribution (or money purchase) scheme shortly before a terminally ill member died.

Following a divorce, Mrs Stavely transferred her rights from a pension she had set up with her ex-husband into a new scheme, and then named her children as beneficiaries, to avoid the benefits being paid under a binding nomination … Continue Reading