In April 2015 the taxation of pension death benefits changed dramatically. To keep this as simple as possible, I will not detail the previous tax regime, but needless to say, the current regime is more generous in the hands of the recipient. Currently, pension death benefits are taxed as follows. Lump sum benefits and income arising from death before the age of 75 are tax-free. This is providing the money is ‘designated’ to drawdown within two years of the pension provider being informed of death.