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Using a pension...

15 April 2018

1 min read

Using a pension for tax efficient estate planning

Susan dies aged 77 leaving a pension fund of £350,000. She leaves her pension fund to her granddaughter Kate.

Victoria Rutland
Victoria Rutland,

Chartered Financial Planner

Kate decides to draw the money as a lump sum and receives a sum of £192,500 (£350,000 less £157,500 of Income Tax at 45%).

Susan’s friend Nora, 77, leaves her pension fund to her granddaughter Jessica. Jessica is a student and decides to draw an income of £10,600 each year to pay her tuition fees. As Jessica has no other income she can draw this amount each year without paying any tax.

If further income is required to provide for living costs, this would be subject to Basic Rate Tax at 20% (up to the higher rate tax threshold).

Victoria Rutland

Victoria Rutland


Chartered Financial Planner

Victoria has worked in Financial Services for a number of years and joined EQ in 2014. She provides advice on all areas of financial planning with a speciality in retirement planning. Victoria is a Chartered Financial Planner and also holds the Certificate in Long Term Care Assurance. Away from the office, Victoria enjoys travelling and baking an array of goodies.

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