Income Tax (Earnings and Pensions) Act 2003 section 637T

Section 637S: multiple lump sum death benefits paid

Section 637T deals with how to apportion an individual's remaining lump sum and death benefit allowance when more than one lump sum death benefit is paid following that individual's death.

• This section applies where two or more lump sum death benefits are paid in respect of a deceased individual, each triggering a relevant benefit crystallisation event under section 637S(2)(a)(ii).
• All such events are treated as occurring simultaneously, immediately before the individual's death, and immediately after any pension commencement lump sum the individual became entitled to just before death.
• The deceased's available lump sum and death benefit allowance is shared proportionally among the multiple death benefit payments, rather than being applied sequentially on a first-come, first-served basis.
• The proportion allocated to each death benefit is calculated as the amount of that particular lump sum death benefit divided by the total of all lump sum death benefits paid.