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The beneficiary flexi-access drawdown conundrum

Adviser support package

Beneficiary flexi-access drawdown (BFAD) allows individuals to pass on pension benefits in a manner where the beneficiaries have immediate access to the funds after death, while retaining some of the main advantages of being within a pension arrangement. This includes tax-free growth and favourable IHT treatment. 

The rules for who can receive pension funds as a BFAD arrangement are quite complex though. Additionally, the option to “nominate” non-dependants means that expression of wish forms need to be regularly reviewed and updated where required.

Here, we've gathered resources to help you navigate this topic.

An overview

Paul Squirrell, our pension expert discusses the pitfalls and issues to be considered with the payment of beneficiary flexi-access drawdown death benefits.

The beneficiary flexi-access conundrum – video transcript
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The rough guide to money purchase pension death benefit options

Our flowchart provides a simple analysis of the underlying law and the evaluation to follow for each potential beneficiary.

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Pension death benefits payable under money purchase schemes

Topics include: Income tax treatment of benefits paid following the death of the member under age 75; Income tax treatment on death age 75 and over Charity lump sum death benefits.

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Pension death benefits payable under defined benefit schemes

Topics include: Death in service, in deferment or in retirement; Potential beneficiaries; Taxation – member’s death before age 75; Pension freedom rules.

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Expression of Wish and Nomination form guide

A client-friendly guide explaining the importance of completing an expression of wish.

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Pensions 'in-depth': the lifetime allowance

LTA support material all in one place.

Pensions, retirement and tax planning

Pensions and divorce, death benefits, allowances and much more.

Questions or feedback

Although the information provided in this package is fairly comprehensive, it may not answer all your questions. While we can’t undertake to respond to you individually, we’d like to hear your feedback to help develop material that best assists you.