Pension and IHT

I have an estate where the deceased was a single man without issue and had spent some time working in Switzerland (CH). He returned to the UK at the time of the pandemic. When he stopped working in CH and returned to UK, the pension company transfer the pot to a Govt institution, Stiftung, where the funds sit pending collection.
The deceased died in late 2021. His fund is approximately £100,000. The query is whether this fund will form part of his taxable estate. The other assets in the estate (with the exception of this pension) hover around the £325,000 mark. I have checked the Plan Rules and spoken to various individuals in CH and it seems that the monies are not held in any sort of trust. In other words, there is no discretion as to whether the Stiftung will pay these monies out or not. They are payable as of right to various individuals (in this case it will be his Mother) subject to having sight of the LOA and various other documents.
Does anybody have any experience of how they consider such a fund would be treated by HMRC. Are there any other steps which could be taken for certainty.

Contact with HMRC should clarify this for you if others are unable to do so.

This pension might well be a Qualifying Non-UK Pension Scheme (QNUPS) and hence qualify for the same IHT exemption as a registered pension scheme.

HMRC provides some guidance in IHTM 17025.

I wouldn’t waste any time trying to get certainty from HMRC. There are only two interpretations of this Stiftung instrument. It’s either a pension or a bare trust for his mother set up by a former pension provider. As neither of these would need to be reported on IHT form 403, I would proceed on the assumption that it is not part of his estate.
(It’s usually better to beg for forgiveness than to ask for permission.)


If the deceased had general power to give a binding nomination as to who would be entitled to receive the death benefit, then the benefit falls within his estate (s151 & s5 IHTA). See IHTM17052