I tend to trust material coming from First Actuarial. It is simple and clear.
It’s good to see a note on social media on a topic that created uncertainty for millions of workers whose dependents will get a lump sum without threat of tax if they die while employed by a company that offers “death in service.
The value of death in service payments is not recognised till a payment is paid out and then it is an unexpected benefit to a family. It was not right that the value of that benefit could become part of a tricky discussion with the revenue over whether tax might be due.
Many people get this defined benefit but are not , nor ever were accruing pension sponsored by the employer offering them life insurance. Many save into DC arrangements and if they die will have a pot that may trigger a pot. Those building up a pension in a DB or CDC scheme that pays a pension (to a spouse or partner) should not see that pension become part of the estate assessed for inheritance tax .
There is of course a taxation problem for the well off saving into a DC pot but it may be that moving to CDC assuages that worry (so long as the CDC pays a dependent’s pension).
For First Actuarial and advisers and administrators, the situation is easier too.
I like the sentiment from Lee French and from First Actuarial. It is important that we think of pensions as protection for those who live and life assurance as protection for those who live on when the earner has departed.