PAYE76120 | PAYE operation: pensioners: pension paid to dependant of former employee

From HM Revenue & Customs · PAYE Manual

An employer or the trustees of a pension fund may pay a pension to the dependant or other beneficiary of an employee or pensioner who has died.

The payer must

  • send in a P46(Pen) or equivalent FPS notification of the pension

  • keep a payroll record for PAYE purposes only

  • use emergency code on a Week 1 / Month 1 basis