Inheritance Tax Act 1984 section 151

Treatment of pension rights, etc.

Section 151 deals with how pension rights are treated for inheritance tax purposes, providing that certain pension interests are excluded from a deceased person's estate.

• An interest in a registered pension scheme, qualifying non-UK pension scheme, or section 615(3) scheme that ends on death is excluded from the deceased's estate, provided it is a pension or annuity (or a right to one) and does not derive from a non-pension benefit under the scheme.
• The normal rules on interests in possession in settled property (sections 49 to 53) do not apply to pension interests that meet these conditions.
• For the purpose of valuing a person's estate, pension scheme interests are treated as if they could form part of the estate regardless of whether they are settled property.
• Where a pension benefit becomes part of a settlement made by someone other than the person entitled to that benefit, the settlement is treated for inheritance tax purposes as having been made by the person entitled to the benefit.