Government confirms standalone death-in-service benefits exempt from IHT changes

"The draft clause was nonsensical"

Jaskeet Briah
clock • 3 min read

Industry body, Group Risk Development (GRiD), has confirmed that the UK Government will make benefits payable from standalone registered group life pension schemes exempt from the new inheritance tax (IHT) changes.

The industry body highlighted that an earlier draft of Clause 63 of the Finance Bill required members to have been actively accruing benefits under a scheme at the time of death to qualify for an exemption. GRiD said that most group life arrangements, although under pension legislation, are policies that provide just death benefits, so there is no pension accrual in that case. It said that while the condition of the clause may suit pension schemes involving ongoing retirement benefit accrual, it created uncertainty for more than eight million employees covered by stand-alone death ben...

To continue reading this article...

Join COVER for free

  • Unlimited access to real-time news, key trend analysis and industry insights.
  • Stay on top of the latest developments around health and wellbeing, diversity and inclusion and the cost of living crisis.
  • Receive breaking news stories straight to your inbox in the daily newsletter.
  • Members only access to monthly programme 'The COVER Review'
  • Be the first to hear about our CPD accredited events and awards programmes.

Join now

 

Already a Cover member?

Login

More on Regulation

Budget 26: Protection and health reacts

Budget 26: Protection and health reacts

A missed opportunity

Cameron Roberts
clock 28 October 2026 • 5 min read
IPT receipts hit £4.53bn in H1 2026/27

IPT receipts hit £4.53bn in H1 2026/27

Down £11m year-on-year

Jaskeet Briah
clock 21 October 2026 • 2 min read
IHT receipts reach £4.7bn ahead of Autumn Budget

IHT receipts reach £4.7bn ahead of Autumn Budget

Increase of £300m from the year prior

Isabel Baxter
clock 21 October 2026 • 2 min read