IHT409: Reporting Pensions When Someone Dies

This page uses the current IHT409 (HMRC 09/23), HMRC's IHT400 Notes and HMRC's policy paper on pensions, all as of October 2026.

When IHT409 is needed

The IHT400 notes say to fill it in if the person was being paid a pension from an employer, a personal pension or a retirement annuity contract, if payments continued after death, if a death benefit became payable, or if they changed their pension or made contributions in the 2 years before death. A retirement annuity contract is treated on the form as if it were a personal pension policy.

Section 1: pension payments that continue

Most pensions stop at death, but some are guaranteed for a fixed period, so the remaining payments go to the estate. Questions 1 to 7 ask for the scheme, how often and how much was paid, the date of the final guaranteed payment and the value of the right to the remaining payments, which goes in box 56 of the IHT400. HMRC publishes a guaranteed annuity calculator for that figure.

You can answer No to question 1 if the only payments after death were small arrears from the last monthly payment, a reduced widow's, widower's or surviving civil partner's pension, or payments made because the provider didn't know about the death.

Section 2: death benefits

Lump sums and, since April 2015, funds passed on as flexi-access drawdown are both death benefits. Under the current rules, they count as part of the estate in two cases:

1. they're payable to the personal representatives, by right or because no one else qualifies; or
2. the person could, right up to death, have signed a binding nomination obliging the trustees to pay whoever they named.

If the trustees had discretion over who received the benefit, the form tells you not to add the amount to box 56. That makes the paperwork behind the scheme important.

Binding nomination or letter of wishes?

This is the question that changes the answer. HMRC's notes explain that many schemes provide a form called a nomination which then says the trustees aren't bound to follow it. If that's what the person signed, it's a letter of wishes, not a binding nomination, and the trustees kept their discretion. Ask the scheme administrator for the exact wording before you answer questions 11 and 12.

Section 3: transfers and changes in the last 2 years

Questions 17 to 21 ask whether the person transferred or disposed of pension benefits, or changed them, in the 2 years before death. HMRC's examples include choosing not to take a pension at pension age, opting for income drawdown and later cutting the income while in ill health, or reducing segments under phased retirement while unwell. These can be transfers of value. HMRC looks at what you've said after the grant is issued and discusses the value with you if it thinks there was one.

Section 4: contributions in the last 2 years

Questions 22 to 24 ask whether the person or their employer paid into a pension in the 2 years before death, who paid, when and how much.

The change coming on 6 April 2027

Point	From 6 April 2027
Unused pension funds and death benefits	Most come into scope of Inheritance Tax
Death in service benefits from a registered scheme	Excluded from the estate
Who reports and pays	The personal representatives
Holding back funds	They can direct schemes to withhold 50% of taxable benefits for up to 15 months and pay the tax to HMRC
Not covered by the withholding power	Exempt benefits, funds under £1,000 and continuing annuities

For deaths before that date, the current IHT409 rules above still apply, so the date of death decides which regime you're in.

Practical tips

• Use a separate IHT409 for each pension and benefit.
• Check whether each scheme is registered with HMRC; if one isn't, give extra details in the Additional information boxes on the IHT400.
• Contact every provider for date-of-death values and scheme rules early, because their replies set the pace.

If the person still had a workplace pension they hadn't drawn, include it here.

Registered and unregistered schemes

Every section asks whether the scheme or policy is registered with HMRC for Income Tax purposes. Registration is what allows tax-privileged saving, and the scheme papers or policy documents should say whether it applies. If they don't, the scheme administrator can tell you. For a scheme that isn't registered, the notes ask for details of the benefits payable and those already taken, in the Additional information boxes of the IHT400, as well as the IHT409 answers. HMRC's Inheritance Tax helpline is 0300 123 1072 if a situation doesn't fit the questions.

The verdict

IHT409 turns on one detail: whether the person could bind the trustees. Get each scheme's nomination wording, use a separate form per pension, and flag any late changes to drawdown or retirement plans honestly. If the death is on or after 6 April 2027, expect unused pension funds to be part of the Inheritance Tax picture.

Frequently asked questions

What is IHT409?

It's the schedule used with form IHT400 when the deceased received, or had made provision for, a pension other than the State Pension.

Do I need a separate IHT409 for each pension?

Yes. The form says to complete a separate one for each pension and benefit in any section.

Are pension death benefits part of the estate for Inheritance Tax?

Under the current rules, they are if they're payable to the personal representatives or the deceased could have made a binding nomination; benefits paid at the trustees' discretion aren't added to box 56.

What is the 2-year rule on IHT409?

You must report transfers of, or changes to, pension benefits and pension contributions made in the 2 years before the date of death.

What changes for pensions and Inheritance Tax in 2027?

From 6 April 2027 most unused pension funds and death benefits come into scope of Inheritance Tax, while death in service benefits from registered schemes are excluded.