Employers' Guide

Section 11 - Death of a teacher in service

WEB TV – Module 3 Death in Service

1. Short term pensions

Where a teacher dies in pensionable service, any surviving beneficiaries may be entitled to a short-term pension. Before any short term pension can be paid, you must check the status of any adult beneficiaries other than a surviving spouse or registered civil partner with TP. In the case of a surviving spouse or registered civil partner, you should ask to see an original copy of the marriage or registration certificate before issuing any payments.

The short-term pension is in effect a continuation of the teacher’s salary. You are required to pay this to avoid hardship for the beneficiaries and should recover the amount paid by deducting that amount from your monthly contribution return.

Teachers who ceased teaching on grounds of ill-health but are not in receipt of retirement benefits from the TPS and die within 12 months of their last day of teaching service are also entitled to a short-term pension. This is paid by TP.

When a teacher dies in service, you must:

  • Inform TP by e-mail or telephone of the teacher's name, reference number, date of death and the name and address of the next of kin; and
  • Put into payment any short-term pension after verifying that the beneficiary has an entitlement to receive a pension.

The application form for death benefits should be completed by the next of kin. This form can be obtained from the website.

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2. Payment of short-term pensions

A short-term pension begins on the day following the teacher's death and is payable at the rate of the teacher's salary at the time of death. Should a retrospective increase in salary become due the short-term pension should be adjusted.

A short- term pension is payable to:

  • the teacher's spouse, registered civil partner, nominated partner, or nominated adult dependant; and
  • to the child or children of a member.

It may also be paid to a teacher’s partner but only if the partner was previously nominated by the teacher to receive a pension and if those interdepency conditions are still satisfied when the teacher dies.  In these cases you must always confirm with TP that a pension is payable before issuing any payment.

If the teacher has no spouse, registered civil partner, nominated partner, nominated adult dependant or children a short-term pension is not paid.

A child is a person while he or she is unmarried and

  • has not attained the age of 17, or
  • having attained that age is
    •  in full-time education
    •  or attending a course of not less than 2 years' full-time training for a trade, profession or calling

and has done so since attaining that age without a break at any one time of longer than a year but has not attained the age of 23; or

  • is incapacitated at the time of the death of the teacher and unable to earn a living because of ill-health.

A child includes:

  • a legitimate or illegitimate child born during the teacher's lifetime or within 12 months of the date of the teacher's death; and
  • an adopted child.

This pension is paid for a period of 3 or 6 months at the rate of the teacher's final salary less any deductions in respect of income tax. National Insurance contributions should not be deducted from short-term pension payments. The payment arrangements are shown in the table below:

Spouse or registered civil partner or adult nominated dependant or partner

3 months @ member’s monthly salary less any income tax

Spouse or registered civil partner or adult nominated dependant and children or partner

3 months @ teacher’s monthly salary paid to the adult beneficiary less any income tax

3 months @ teacher’s monthly salary paid to child(ren) (the same amount is payable regardless of the number of children)

 

 

Child(ren) only

6 months @ teacher’s monthly salary (the same amount is payable regardless of the number of children)

 

For example:

Teachers Final Salary = £36,000.00

Monthly Gross Salary =£ 3,000.00

Gross short-term pension payable is: £3,000 a month for spouse or registered civil partner or adult nominated dependant for 3 months. Tax should be deducted in line with HMRC rules.

£3,000 a month for child(ren) for 3 months

If no surviving spouse, registered civil partner or nominated partner:
£3,000 a month for child(ren) for 6 months

If the teacher was employed on a regular part-time contract at the time of death, the short-term pension will be based on the same percentage of the full-time contract. If the teacher was not employed on a regular part-time contract the short-term pension will be paid at the full-time rate.

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3. Accounting arrangements

You should recover the value of the short-term pension paid to the beneficiaries by deducting that sum from your next monthly submission of pension contributions. You will need to record this on the payment form that you submit via STU.

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4. Income Tax

Short-term pensions paid to adults are subject to PAYE income tax deductions.  Any queries about tax should be directed to your local tax office.

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