IHT on pension lump sum

[Cloisters]

I am trying to get confirmation that a DC pension lump sum paid on death is not taxable but no one will confirm one way or the other so would appreciate thoughts on the position or how I can get confirmation.

My sister in law died suddenly aged 60 (never married) having retired shortly before. She had a pension nomination in favour of her mother (that she nominated 40 years ago), but her mother is now 91 and does not want the money, but asked for it to go to her remaining children equally to bypass her own estate which would otherwise make the lump sum liable to IHT on her own death.

The pension company trustees decided to pay it to the the administrator of the estate on this basis.

My assumption as the administrator is that I am simply being used as a conduit to distribute the funds per the will i.e. to the residual beneficiaries which are the siblings of the deceased.

I further believe that the pension lump sum is not part of the deceased's estate and therefore not subject to IHT. The trustees had full discretion on who to pay the monies to.

Thanks in advance.

[pawncob]

https://om.uk/insight/pensions-inheritance/