Inheriting uk pension, tax liability

[elcato]

A friend has inherited his brothers private pension remainder in the UK. This falls outside of probate apparently as the pension company do the due diligence and pay the beneficiary directly. Is the tax on this the same as inheritance tax ie 33% ?

 

[TomEdison]

The tax on this is not the same as inheritance tax; it is inheritance tax. Inheritance tax is chargeable on anything you get on account of somebody having died; it's irrelevant that you didn't get it directly from them or their estate.

 

[Farma1]

Is your friend tax resident here or is you friend in the UK? If they are in the UK then it falls outside of the estate for inheritance tax (for now - this is the change that was announced recently but hasn't come into effect yet). If they are here then Irish CAT is due by the receiver of the inheritance. It's CAT tax group B thats due - ie 33% on everything over 40k (presuming they haven't used any group B banding before)

 

[elcato]

The tax on this is not the same as inheritance tax; it is inheritance tax. Inheritance tax is chargeable on anything you get on account of somebody having died; it's irrelevant that you didn't get it directly from them or their estate.

Thanks. So he will get a tax credit for the inheritance paid by the estate but can he use any extra paid there to credit the tax paid by pension company amount (33%) ? Also timing, he will get the pension payout before the probate will be sorted out. Is the tax due separately on receiving both amounts or can he wait till probate is paid out and then file the tax ?