The 55% tax charge levied on beneficiaries of individuals who die under the age of 75 with a joint life or guaranteed term annuity has been abolished in the Autumn Statement.
In a widely anticipated move beneficiaries will be able to receive any future payments from such policies tax free where no payments have been made to the beneficiary before 6 April 2015. The tax rules will also be changed to allow joint life annuities to be paid to any beneficiary. If the annuitant dies after the age of 75 then the beneficiary will pay the marginal rate of income tax, or 45% if the funds are taken as a lump sum payment. Lump sum payments will be charged at the beneficiary's marginal rate from 2016-17. The announcement will bring tax treatment for annuities in l...
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