If you die before you’ve started taking your benefits, what happens depends on a few things.
It depends on whether you have reached your normal pension age (the age you can take your benefits without any reduction). For most members, this is 62. If you’re not sure, contact our administrators.
It might also depend on whether you:
- are married or in a civil partnership
- told us you wanted to delay taking your benefits beyond normal pension age
If you die before normal pension age
If you are married or in a civil partnership, we’ll pay your surviving partner a monthly income.
That income will be half of what you were entitled to, unless they are more than 10 years younger than you. If they are, this income is reduced as we’ll expect to pay them for longer.
If you do not have a surviving partner, your beneficiaries will get a lump sum. They will not have to pay inheritance tax on this.
If you die after normal pension age
If you have a surviving spouse or civil partner, they’ll get a monthly income. That income is usually half of what you were entitled to, but could be reduced if:
- they are more than 10 years younger than you (as we’ll expect to pay them for longer)
- you get married or form a civil partnership after you reach your normal pension age, then die within 6 months of the marriage or civil partnership without telling the trustee that you want to delay taking your benefits
The Fund will also pay a lump sum that’s equivalent to 5 years of your pension.
Who gets this lump sum depends on whether you told us you wanted to delay taking your benefits beyond your normal pension age, and whether you die within 5 years of reaching that normal pension age.
If you told us you wanted to delay taking your benefits, the lump sum will go to your beneficiaries. They will not have to pay inheritance tax on it.
If you did not tell us, it will go to your estate. They probably will have to pay inheritance tax on it.
If you die within 5 years of your normal pension age, some of the lump sum will go to your beneficiaries. They will not have to pay inheritance tax on it.
If you want to delay taking your benefits beyond your normal retirement age, contact our administrators.
You do not need permission to do this. But if you do not tell us, your benefits will not increase every year with inflation, and your beneficiaries will get less.
If you get divorced or end your civil partnership
Your former spouse or civil partner may be entitled to some of your pension.
When you’re already taking your pension:
- its value is offset against other assets you had as a couple
- part of your pension is transferred as cash to your former spouse or civil partner
- you pay a percentage of your regular pension to your former spouse or civil partner
For more information, download Mercer’s ‘guide to what happens when married members divorce and civil partnerships are dissolved’ (PDF).