SolvedIHTM17082 | Pensions: relevant property charges: employer-financed retirement benefits schemes
From HM Revenue & Customs · Inheritance Tax Manual
As for any other relevant property trust, IHT charges on an employer-financed retirement benefit scheme (EFRBS) can arise when
There is no statutory obligation on the member of an EFRBS to take benefits at any particular time or in any particular way, although the scheme itself will have its own rules.
Before considering any Inheritance Tax charges on an EFRBS, you should check whether the scheme was established before 6 April 2006 so that the whole or part of the fund is protected from relevant property charges as a sponsored superannuation scheme (IHTM17039).
Entry charges
In most cases, there is no IHT charge when property enters an EFRBS because the employer making the payment is not a close company. Even where the employer is a close company, meaning that there could be a charge on the participators (IHTM14851) on a transfer of value, it is likely that business property relief (IHTM25000) will be available. If you see a case involving a close investment company making payments into an EFRBS, you should refer it to Technical.
Ten-year anniversary charge
This is the most likely charge to arise, given the long-term nature of pension schemes and follows the usual rules (IHTM04096).
Exit charges
Exit charges will arise when property leaves an EFRBS, unless the scheme itself pays a pension or annuity that is income in the hands of the beneficiary.