Section 210 — Inheritance Tax Act 1984: Pension rights

Pension rights 210 1 This section applies to any tax that is attributable to the value of notional pension property of a deceased member of a registered pension scheme, a qualifying non-UK pension scheme or a section 615(3) scheme.

2 For the purposes of this Part the tax is treated as also attributable to the value of—

a any property held for the purposes of the scheme that is available for paying a benefit on the deceased’s death, except so far as the property may only be used to provide an excluded benefit, or an exempt benefit, on the deceased’s death, and b any property that is received by a person under the scheme as a benefit on the deceased’s death, other than an excluded benefit or an exempt benefit.

3 The persons liable for the tax (as well as including a person within section 200(1)(c) (person in whom property is vested etc))—

a include the deceased’s personal representatives so far as they are not already liable under section 200(1)(a),

b where the scheme is a registered pension scheme, include the scheme administrator where—

i a benefit has been paid in breach of section 226A (withholding of benefits), or ii the scheme administrator has failed to comply with section 226B (direct payment of tax on receipt of notice),

and c where the scheme is a registered pension scheme or a section 615(3) scheme, do not (despite section 200(1)(b) and (c)) include the trustees of the scheme (if there are any) or any other person who holds property for the purposes of the scheme in question.

4 Where the scheme administrator is liable for tax by virtue of subsection (3)(b)(ii) (and not by virtue of subsection (3)(b)(i)), their liability is limited to the amount of tax that they have failed to pay as required under section 226B.

5 Sections 271 to 272C of the Finance Act 2004 (liability of scheme administrator) apply in relation to a liability under this Act as they apply in relation to a liability under Part 4 of that Act.

6 Subsection (3)(c) does not prevent a person from being liable to tax—

a under subsection (3)(b) in their capacity as scheme administrator, or b by virtue of subsection (5).

7 In this Act “ exempt benefit ”, in relation to a pension scheme and a deceased member of the scheme, means a benefit paid under the scheme if and so far as the payment renders the transfer of value made on the deceased’s death an exempt transfer.

8 For provision under which a payment of a benefit renders the transfer of value on death an exempt transfer to the extent of the payment, see— section 18 (transfers between spouses or civil partners); section 23 (gifts to charities or registered clubs); section 24 (gifts to political parties); section 24A (gifts to housing associations); section 25 (gifts for national purposes etc); section 27 (maintenance funds for historic buildings etc).