Nobody likes to think about what will happen if they pass away. Bringing up the subject of your death and who will benefit financially isn’t a conversation you’re likely to feel comfortable having. However, it is a topic you should not ignore.
Firstly, what are the basic NHS Death in Service benefits?
Some Death in Service payments are automatic, while others necessitate some form filling on your part.
The component parts of the NHS Death in Service are:
- A lump sum
- A short term 6 month pension
- Spouse/partner’s pension
- A dependent child’s pension
How much will my family receive?
This answer depends on which section of the NHS pension scheme you are in; 1995, 2008 or 2015 and whether you are an ‘Active’ or ‘Deferred Member’.
An ‘Active Member’ is someone currently contributing to the scheme, and a ‘Deferred Member’ is a former member who no longer contributes to the scheme, not eligible for a refund but not yet receiving their NHS pension.
For further details, take a look at the scheme booklet: NHS Pensions Survivors Guide >
Who can NHS pension scheme Death in Service benefits be paid to?
To benefit from Death in Service you could be:
- Civil Partners and Married Same Sex Partners
- Qualifying partners who have completed the NHSPS Partners Nomination form (PN1). Both partners must have completed the form and it has to have been submitted prior to death.
To be considered a qualifying partner, all the following conditions must be satisfied at the date of your death and have existed for a continuous period of at least two years:
- Neither person has a legal partner, i.e. a spouse or registered civil partner.
- They are not related to each other in a way which would prevent marriage or registered civil partnership.
- They live together in an exclusive relationship as if they were husband and wife or civil partners.
- One partner is financially dependent on the other, or they are financially interdependent on each other.
Essentially ‘qualifying partners’ in the 21st century get the same benefits as other legal partners. However, the qualifying partner does need to be nominated.
So, if you haven’t already completed the NHS pension scheme’s nomination of beneficiaries form (PN1) we strongly recommend doing so straightaway. It’s a simple job that could make all the difference.
As mentioned, independent ‘children’ can receive a pension. Generally, if a child is financially dependent and under 17 or over 17 but under 23 and is continuing in full-time education/training, or aged 17 and over and incapable of earning a living due to permanent physical or mental infirmity from which he/she was suffering at the time the member died then, they should qualify for a dependents pension.
Two children maximum, can be supported at any time in this way. Also, younger children will be supported as older ones cease to qualify.
As modern families have evolved, so have the definitions, including other possible child dependents, including not only your own biological children but also children of a civil partner, adopted children and even a niece or nephew.
See the NHS Pension Scheme’s Survivors Guide for full details. At least 2 years membership must have been completed for a dependent’s pension to be payable.
Increasing your pension and buying life protection
Don’t forget you can now buy Additional Pension to increase your NHS pension. You can also opt in or out of buying additional death or ill health pension benefits. However, this may have implications for your annual allowance and your lifetime allowance so always take advice before taking this route.
More changes on the horizon – The McCloud Remedy
Historically there have been differences across the different NHS pension schemes regarding Death in Service and Ill Health benefits, particularly how these benefits are paid out and how the benefit figure is calculated.
The much anticipated McCloud Remedy will have important implications for all scheme members and their beneficiaries. The government has yet to finalise the legislation ahead of retrospective changes, to be introduced by 1 October 2023.
As part of the McCloud Remedy the NHS pension schemes are prioritising cases of members who have passed away since April 2015. The beneficiaries in these cases will have a range of options to consider. Schemes should inform relevant family members where this is the case.*
What actually happens to my NHS pension benefits when I die?
- If you are working in pensionable NHS employment at the time of your death, your last employer will arrange completion of the appropriate application forms.
- It is important that someone notifies the scheme administrator as soon as possible of your death.
- Don’t forget, if you are a Locum at the time of death, things are not so straight forward. Read our blog: GP Locums: Will you get your death in service benefit? >
- The Death in Service lump sum needs to be paid within 2 years of the date the scheme administrator was first notified of your death. If not, a tax charge of up to 45% will be deducted from the lump sum payment.
NHS pension Death in Service benefits: Are they worth it?
These Death in Service benefits remain as valuable as ever. At a time when some medics question the value of their NHS pension membership, it’s easy to overlook the basics and forget how invaluable the financial support would be for your family if you passed away.
Ensure your loved ones are taken care of by taking them into account when reviewing your protection arrangements. Make sure your family is nominated correctly and don’t forget you can update your nominations easily if your life changes.
It is important financial matters are organised and steps are put in place to reduce the stress of death within the family unit. Getting your head around the NHS pension scheme and its benefits is not easy. Your Legal & Medical financial adviser can help make it less painful.
If you wish for more detail then you will find the members hub really useful. There you will find dedicated sections to death in service benefits.
If you need further information about making a claim then there is also assistance on their website.
Do you know who will get your NHS pension benefits when you die? Let us know by adding a comment below.
This article was first published in February 2019. It has been revamped and updated for accuracy and comprehensiveness. This article is not specific advice. We would always suggest that you get specialist advice in this area.