What happens to my pension when I die?
Most modern pensions pass to your nominated beneficiaries outside your will — the scheme trustees pay out, guided by your nomination (expression of wishes) form, so keeping it current is vital. Whether anything is taxed is changing: from 6 April 2027, most unused pension funds will count within your estate for inheritance tax, even though they still pass by nomination.
Detailed explanation
Two questions: who receives it, and whether it's taxed.
- Who receives it: usually your nominated beneficiaries, via the scheme trustees — not through your will.
- Keep your nomination current: an out-of-date form (e.g. naming an ex) can send it to the wrong person.
- Tax (from 6 April 2027): most unused pension funds fall within the estate for inheritance tax.
- Some older or defined-benefit schemes have their own fixed rules.
Mei's workplace pension has an up-to-date nomination naming her two children. When she dies, the scheme trustees pay them directly, outside her will. From April 2027 the unused fund would also be counted in her estate for inheritance tax.
- Complete the questionnaireA few guided questions about you, your family and your wishes.
- Human reviewYour answers are checked by the ClearLegacy editorial team for completeness.
- Receive your documentsYour will and supporting paperwork are produced, ready to print.
- Sign correctlyClear instructions on signing and witnessing so the will is legally valid.
- Protect your familyYour wishes are recorded and your loved ones are spared the intestacy default.
Sources
- MoneyHelper — What happens to your pension when you die
- GOV.UK / HMRC — Inheritance Tax on pensions (from 6 April 2027)
- Finance Act 2026 — legislation.gov.uk
- Reviewed by
- ClearLegacy editorial team
- Last reviewed
- June 2026
- Next review
- December 2026
- Jurisdiction
- England & Wales
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