Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps her Department is taking to examine how AI could speed up the issuance of Remedial Service Statements to people in receipt of public sector pensions affected by the McCloud judgement.

Answered by Torsten Bell - Parliamentary Secretary (HM Treasury)

Scheme managers of the individual public service pension schemes are responsible for ensuring the effective delivery of the McCloud remedy to affected members. I have written to scheme managers to remind them of their responsibilities to implement the remedy as quickly as possible and I would expect them to work with administrators the most appropiate available tools to do this.

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, with reference to changes to the inheritance tax treatment of pension pots whether it is her policy that a) the total estate will be taken to include the unused pension pot, and b) donations to charity made from the unused pension pot will be considered as contributing to the 10% minimum.

Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)

At Autumn Budget 2024, the Government announced that unused pension funds and death benefits payable from a pension will form part of a person’s estate for inheritance tax purposes from 6 April 2027.

Where at least 10% of a person’s net estate is left to a qualifying charity, their estate is taxed at a reduced rate of inheritance tax of 36% instead of 40%. When considering this, the pension will fall within the general component of the estate. This component includes the deceased’s free estate and from 6 April 2027 will also include any unused pension funds and death benefits (called notional pension property). Any notional pension property that is paid to a qualifying charity will count toward the charitable giving conditions for the general component Further guidance can be found here: https://www.gov.uk/hmrc-internal-manuals/inheritance-tax- manual/ihtm45003. Guidance will be updated before the changes are implemented in April 2027.

Charity Lump Sum Death Benefits can be paid free of Income Tax. These lump sums are deliberately limited to money purchase arrangements where the deceased member had no dependants. These rules are not changing as this ensures that pension funds are used to support dependants where they exist, while allowing schemes to pay out benefits where there is no other beneficiary.

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment her Department has made of the potential merits of amending the definition of a charitable lump sum death benefit so that people with dependents do not face barriers to donating to charity from their pension.

Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)

At Autumn Budget 2024, the Government announced that unused pension funds and death benefits payable from a pension will form part of a person’s estate for inheritance tax purposes from 6 April 2027.

Where at least 10% of a person’s net estate is left to a qualifying charity, their estate is taxed at a reduced rate of inheritance tax of 36% instead of 40%. When considering this, the pension will fall within the general component of the estate. This component includes the deceased’s free estate and from 6 April 2027 will also include any unused pension funds and death benefits (called notional pension property). Any notional pension property that is paid to a qualifying charity will count toward the charitable giving conditions for the general component Further guidance can be found here: https://www.gov.uk/hmrc-internal-manuals/inheritance-tax- manual/ihtm45003. Guidance will be updated before the changes are implemented in April 2027.

Charity Lump Sum Death Benefits can be paid free of Income Tax. These lump sums are deliberately limited to money purchase arrangements where the deceased member had no dependants. These rules are not changing as this ensures that pension funds are used to support dependants where they exist, while allowing schemes to pay out benefits where there is no other beneficiary.

Found: Watch the meeting Members present: Simon Hoare (Chair); Markus Campbell-Savours; Sam Carling; Lauren

Found: Q174 Sam Carling: Thank you. That leads on to what I was going to ask about.

This inquiry will examine two reports laid by the Parliamentary and Health Service Ombudsman in September 2025 which relate to separate investigations into two complaints about the Charity Commission for England and Wales (the Charity Commission).