Clare Moffat: Why the spousal bypass trust remains a useful planning tool

Bloodline planning

clock • 4 min read

Spousal bypass trusts can help in complex family situations, explains Clare Moffat, and are still highly relevant even after the introduction of the Taxation of Pensions Act 2014

Death benefits on pensions are usually not liable to inheritance tax (IHT) on the death of a member. Before April 2015, the main reason spousal bypass trusts were set up was so lump-sum death benefits did not become part of the IHT assessable estate of the intended beneficiaries. New legislation introduced by the Taxation of Pensions Act 2014, however, means that, in the vast majority of cases, the benefits are now able to pass down through generations free of IHT - as long as they remain in the pension wrapper. As such, many have said that spousal bypass trusts are no longer required. ...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Tax planning

Costly procrastination: Why inheritance tax is becoming a wider UK problem

Costly procrastination: Why inheritance tax is becoming a wider UK problem

'There is a clear disconnect between awareness and follow‑through'

Hugi Clarke
clock 14 May 2026 • 4 min read
Most millionaires would pay higher taxes to support young people – research

Most millionaires would pay higher taxes to support young people – research

79% willing to pay higher taxes

Sophia Panayi
clock 13 May 2026 • 3 min read
IHT thresholds would be £270,000 higher if they rose in line with inflation

IHT thresholds would be £270,000 higher if they rose in line with inflation

Growing interest in onshore bonds

Isabel Baxter
clock 13 May 2026 • 2 min read