This guide is for financial advisers only. It must not be distributed to, or relied on by, customers. The information on this page is based on our understanding of legislation as at 6 April 2024.


Dependant means:

  • The member’s spouse or civil partner at the date of the member’s death (or, if scheme rules allow, at the date the member first became entitled to a pension entitlement under the scheme)
  • Any child of the member under the age of 23 when the member dies1
  • Any child of the member aged 23 or over who, in the opinion of the scheme administrator, is dependent on the member because of physical or mental impairment
  • Anyone who isn’t married to the member, isn’t a civil partner of the member or isn’t a child of the member, but in the opinion of the scheme administrator, was financially dependent on, or inter-dependent with, the member at the member’s date of death (for example, an unmarried partner), or was dependent on the member because of physical or mental impairment.

1Until 15 September 2016, the child of a member ceased to be classed as a dependant when they reached age 23, unless in the opinion of the scheme administrator, at the date of death they were dependant on the member because of physical or mental impairment.

Since 16 September 2016, there is no age 23 restriction for the purposes of allowing a deceased member’s child to continue in flexi-access drawdown or capped drawdown beyond the age of 23. Before this amendment, any income paid after the child reached age 23 was an unauthorised payment. This change only applies where the child in question reaches age 23 on or after 16 September 2016.

This amendment does not affect the definition of a child as a dependant for the purposes of securing a dependant’s annuity or providing a dependant’s scheme pension (the dependant’s pension must stop when the child reaches age 23, unless they can still be classed as dependent as a result of mental or physical impairment). Nor will it affect the meaning of ‘nominee’ – i.e. a nominee of the member or the scheme administrator can be any individual, but not a dependant (so a child under age 23 can’t be a nominee (assuming no physical or mental impairment) but a child aged 23 or over can). Finally, it doesn’t affect the definition of a dependant for the purposes of paying a charity lump sum death benefit (see ‘The charity lump sum death benefit’ for more information). Where the member has nominated a charity to receive a lump sum, this can’t take effect if there is a dependant of the member – the age 23 restriction will continue to apply here.

Nominees and successors

Changes to who can receive drawdown income or annuities from death benefits when a member dies were made on 6 April 2015. Prior to that date, income from death benefits could only be paid to a dependant of the member. Since 6 April 2015 pension death benefits can be paid to dependants, ‘nominees’ and ‘successors’.

nominee can be any individual other than a dependant, who is nominated by the member (or where there are no dependants and where no individual or charity has been nominated by the member, any individual nominated by the scheme administrator).

successor is an individual who inherits any unused drawdown funds (but not uncrystallised funds) on the death of a dependant, a nominee or another successor. Successors are individuals (who can also be dependants of the member) who have been nominated by a dependant, nominee or successor of the member, or if no nomination has been made by any of these beneficiaries, nominated by the scheme administrator. Note – members can’t nominate successors.

There is no limit on the number of successors who can benefit from unused drawdown funds. This means it’s possible to pass unused drawdown funds through multiple generations when dependants, nominees or previous successors die.

For example, Joan dies with unused flexi-access drawdown funds. Before her death she nominated her younger brother, Robert, as a ‘nominee’. When Joan dies, Robert can either:

  • Take a lump sum death benefit
  • Use the unused drawdown fund to purchase an annuity
  • Use the unused drawdown fund for nominee’s drawdown.

Robert chooses the third option and decides to pass the funds onto the next generation of his family, so he nominates his son as a ‘successor’. When Robert dies, his son can choose from the same options that Robert had. If he decides to designate the funds into successor’s drawdown in his own name he can then choose whether to take income, leave the funds invested until a future date or pass them on to the next generation of his family, in the same way that his dad did.

Both nominee’s and successor’s drawdown must be flexi-access and can be paid either as:

  • Nominee’s/successor’s income withdrawal, or
  • Nominee’s/successor’s short-term annuity

Funds can be designated to nominee’s drawdown from the deceased member’s capped or flexi-access drawdown fund, or from any uncrystallised funds remaining on death.

The position is similar for successor’s drawdown except that it isn’t possible to designate uncrystallised funds into a successor’s drawdown fund – only unused crystallised funds can be applied to a successor’s drawdown fund.

A non-qualifying person in relation to payment of a lump sum death benefit is:

  • A person who is not an individual, or
  • A person who is an individual, and the payment is being made to them in their capacity as:
  • A trustee (but not a bare trustee)
  • A personal representative
  • A director of a company
  • A partner in a firm, or
  • A member of a Limited Liability Partnership.

Where a lump sum death benefit is subject to a Special Lump Sum Death Benefit charge and is paid to a non-qualifying person in their capacity as a trustee (but not a bare trustee), if the trust pays any part of the lump sum as a settlement to a beneficiary, the gross amount of the lump sum (so before the 45% tax charge) will be treated as income of the beneficiary for income tax purposes. However, the beneficiary can claim a reduction in their tax charge to take account of the 45% tax charge paid by the trust. See the Government website for more information.