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The IHT provisions for alternatively secured pensions (ASP) will change
in line with the new proposals for transferring the balance of the unused
nil rate band on the death of a surviving spouse or civil partner. Under
current provisions, a charge arises on left-over ASP funds once a relevant
dependant’s pension benefits cease. The rates of tax that apply are those in
force at that time rather than those that apply at the date of death of the
scheme member. This rule is to be modified to take into account the proposed
changes so that relief will be given where the IHT nil-rate band was not
fully used when the original ‘owner’ of the ASP died. This proposal is to be
welcomed. |
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