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<p>Maternity, paternity, and adoption leave, as well as part-time working, can ultimately impact your pension contributions and pension benefits you receive. Here’s a straightforward guide to what you need to know.</p><p><strong>Maternity pay and leave</strong></p><p>You are entitled to statutory maternity pay if you:</p><ul><li>have worked for your employer for 26 weeks when you reach the 15th week before your due date, and</li></ul><ul><li>earn on average at least £123 per week.</li></ul><p>You’ll be entitled to 52 weeks statutory maternity leave and receive statutory maternity pay for 39 weeks. For the first six weeks, you’ll get 90% of your average weekly earnings. For the next 33 weeks, you receive 90% of your weekly earnings, or £151.20 a week, whichever is lowest. The remaining 13 weeks are unpaid. These are your statutory rights, but your employer may have a different policy.</p><p>Usually, the earliest your paid maternity leave can start is the 11th week before your baby is due. If your baby is born early, your leave starts the day after the birth.</p><p>You don’t have to take the 52 weeks you’re entitled to, but you must take at least two weeks off work following the birth.</p><p><strong>Paternity leave</strong></p><p>Under the same rules as statutory maternity pay, you are entitled to two weeks’ statutory paternity pay. The weekly rate is £184.03 or 90% of your average weekly earnings, whichever is lower.</p><p><strong>Adoption leave</strong></p><p>If you’re adopting or having a child through surrogacy, you’re usually entitled to paid time off work. This is subject to the same rules and requirements (as above) for maternity pay and the pay structure is identical.</p><p>If you’re adopting as a couple, only one person can get adoption leave. The other might be able to get paternity leave or shared parental leave.</p><p><strong>Shared parental leave</strong></p><p>Alternatively, you and your partner may be able to get shared parental leave and statutory shared parental pay. You can share up to 50 weeks of leave and up to 37 weeks of pay between you.</p><p><strong>Your pension during family leave&nbsp;</strong></p><p>Your pension Scheme membership will be continuous while you are off, unless you have an agreement with your employer for this to be different. Your pension contributions may change during family leave, because pension contributions are calculated using a percentage of your earnings.</p><p>If your pay reduces to nil, then your contributions will stop. Your employer may continue to pay them on your behalf, but you may have to pay these back once you return to work.</p><p>While you’re on family leave, your pension benefits won’t be affected (as long as you haven’t opted out and contributions are paid) and your overall benefits will still be based on your final average pay.</p><p>For more information, check the&nbsp;<a target="_blank" href="https://cdn3.railpen.com/mp-sitefinity-prod/docs/default-source/rayn/guides-for-active-(contributing)-members/guide-for-family-leave.pdf?sfvrsn=9db485ae_12">family leave guide</a>.</p><p><strong>The gender pension gap</strong></p><p>The career breaks women take to care for their families’ amount to £39,000 in lost pension savings, according to NOW: Pensions’ 2024 gender pensions gap&nbsp;<a href="https://www.nowpensions.com/insights/fair-pensions-for-all/gender-pensions-gap" target="_blank" data-sf-ec-immutable="" data-sf-marked="">report</a>. This is because, in many cases, women pause their careers or go part-time to care for their children (this is also known as the ‘motherhood penalty’).</p><p>The 2023 Women and Retirement <a href="https://adviser.scottishwidows.co.uk/assets/literature/docs/61096.pdf" data-sf-ec-immutable="" target="_blank">report</a>, produced by Scottish Widows, shows that 44% of UK mothers spend all 5 working days looking after their children (compared to just 16% of fathers). Some women consider having a longer career break, doing part-time work, freelancing or taking on multiple jobs. However, this means that many women might not be earning enough to pay into a private or workplace pension. People in the UK need to earn at least £10,000 a year in order to meet the criteria for pension<a href="https://www.moneyhelper.org.uk/en/pensions-and-retirement/auto-enrolment/automatic-enrolment-an-introduction" target="_blank" data-sf-ec-immutable="">&nbsp;</a><a href="https://www.moneyhelper.org.uk/en/pensions-and-retirement/auto-enrolment/automatic-enrolment-an-introduction" target="_blank" data-sf-ec-immutable="">auto enrolment</a>.</p><p>The 2024 gender pensions gap report also shows that women are far more likely to take time out of work to care for an elderly or sick family member.</p><p>What is more, the fact that they’ll have worked less years throughout their life could also&nbsp;disqualify them from receiving a&nbsp;<a href="https://www.gov.uk/new-state-pension" data-sf-ec-immutable="">State Pension</a>. To get any State Pension, people in the UK are required to have worked for 10 qualifying years. To get the full State Pension, 35 qualifying years of work are required. The 2023 Women and Retirement report also says that often women take around 10-year career gap to shoulder caring responsibilities which poses a real risk of not qualifying for any state pension further down the line. You can check your&nbsp;<a href="https://www.gov.uk/check-state-pension" target="_blank" data-sf-ec-immutable="">State Pension forecast</a>&nbsp;on the government’s website.</p><p><strong>Working part-time</strong></p><p>Many parents, especially mothers, choose to work part-time to balance work and family. While this offers flexibility, it affects your pension.</p><p>If your working hours change it’s likely your wages will too. That means how much you pay into your pension may also change. The amount that you pay into your pension is worked out using your full-time rate of&nbsp;<a href="/knowledge-hub/help-and-support/glossary">Section Pay </a>for your job, but is reduced for the hours you work.</p><p>If you go part-time then you’re still entitled to the same range of benefits as your full-time colleagues. However, the amount you pay in and the amount you receive will be based on the part-time hours you work. You can find out more in the&nbsp;<a target="_blank" href="https://cdn3.railpen.com/mp-sitefinity-prod/docs/default-source/rayn/guides-for-active-(contributing)-members/guide-to-part-time-work166beabb5d844e31a0839a6ff1bb075b.pdf?sfvrsn=4d5472da_9">guide to part-time work</a>.</p><p><strong>The gender pay gap</strong></p><p>The gender pay gap – the difference between the earnings of men and women – is deemed one of the major drivers of the pension gap. Women have been earning (and still earn) less than men on average, although&nbsp;<a href="https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/genderpaygapintheuk/2023" data-sf-ec-immutable="">2023 figures</a>&nbsp;show a narrowing of this gap over time. In April 2023, women earned an average of 7.7% less than men per hour according to the ONS.</p><p>The significant gap in income means women have less capacity to meet increasing financial demands. The 2023 Women and Retirement report, by Scottish Widows suggests that on average, women are paid 15% less per hour across all jobs in the UK. The report also highlights that only 59% of women aged 22-65 are saving into a private pension, compared to 71% of men, while 62% of men are also expecting to be able to draw from other long-term savings sources in retirement, compared to just 50% of women.</p><p>It’s not all doom and gloom for women, though. The 2024 pension gap report shows a positive tendency of more women undertaking higher education, and therefore entering the workforce with higher salaries. If the trend continues, the gender pay gap is likely to reduce further over the coming years, as more young women go on higher education. This could mean better retirement outcomes too.</p><p><strong>What to do make the most of your pension with the Scheme</strong></p><ul><li>Make sure you register for a myRPS account so you can take advantage of all the guidance and pension planning tools available to help you prepare for retirement.&nbsp;<a href="/login">Register and/or log in</a> and check your account today.</li><li>Don’t forget your national insurance credits. Many benefits, including child benefits, automatically give you NI credit. Some women don’t sign up for child benefit because if their partner earns over £50,000 they would have to start paying it back.&nbsp; But you don’t need to actually receive the cash – you can just sign up to ensure your NI record and then your State Pension will be protected.</li><li>You could consider extending your working life. Your Railways Pension Scheme pension will offer you a Normal Retirement Age (NRA) but normally you can work and remain a member beyond this date. <a href="/login">Log in to your myRPS</a> account to check what your NRA is.</li><li>Putting in a small, extra regular amount now into AVCs (Additional Voluntary Contributions), could go a long way towards a better future. You can put as little as £2 extra per week. This means you make the most of the valuable tax relief you get and the longer you have your money invested, the more chance it has to grow. If you’re a DB member of the RPS, the main AVC scheme is called&nbsp;<a href="/defined-benefit-members/saving-more-BRASS-AVC-Extra/saving-more-with-BRASS">BRASS</a>.&nbsp; For IWDC members, you can&nbsp;<a href="/iwdc-members/Im-still-working/saving-more">save more with AVCs</a>.</li><li>If you’ve had a number of different jobs, don’t forget to check that you’ve kept track of all your past pension schemes. The Pension Tracing Service is free and can help you find a pension you’ve lost. Go to&nbsp;<a href="https://www.gov.uk/find-pension-contact-details" target="_blank" data-sf-ec-immutable="">gov.uk/find-pension-contact-details</a>&nbsp;and follow the online steps.</li></ul>

<p>It isn’t a cheerful topic, but it’s an important one - especially if you want to make sure the ones you care about are looked after. <br></p><p>In a nutshell, when you die, the ones closest to you could receive part of your pension benefits. However, who is eligible for what portion of it depends on a few quite important things:<br></p><ul><li>your membership status at the time of your death </li><li>their relationship to you prior to your death</li><li>whether they were included in your nomination or not<br></li></ul><p>We break it all down in this blog.</p><p>&nbsp;</p><h3>First things first – your membership status</h3><p>The benefits your family or dependants may receive depend on your membership status at the time of your death i.e. whether: <br></p><ul><li>you’re still paying into your pension (active member)</li><li>you’re no longer contributing towards your rail pension (preserved member), or </li><li>you’re already drawing it (retired member)<br></li></ul><p>Here’s a breakdown of what typically happens in each case:<br></p><h6>Active members <br></h6><p>If you die while you are still working and paying into the Railways Pension Scheme (RPS), the following death benefits could be paid out to the ones closest to you:<br></p><ul><li>A tax-free lump sum death benefit – this can be up to 4 times your pensionable salary, depending on the rules of the Section you’re a member of. For more information, check your member guide when you <a href="/my-rps">log into your myRPS account</a>. If you’ve saved extra with Additional Voluntary Contributions (AVCs), the value of your AVC pot may also be paid.<del cite="mailto:Hannah%20Blowers" datetime="2025-09-09T16:56"> </del></li><li>A spouse/civil partner’s pension - your spouse/civil partner could receive a pension from the Scheme upon your death. The amount they receive is normally around 50% of the pension you had built up at the time of death, though this percentage varies slightly depending on the Section you’re a member of. They will receive less pension if they are younger than you by 10 years or more. </li><li>Eligible child’s pensions - if certain criteria is met, pensions may also be paid to the two youngest dependent children. <a href="/my-rps">Check your member guide for more details</a><a id="_anchor_2" href="https://railpen-my.sharepoint.com/personal/jenny_prodanova_railpen_com/Documents/0.Personal/2025/Blogs/What%20happens%20to%20my%20pension%20when%20I%20die/TSR8159%20-HB%20&amp;amp;%20AYB%20comments%20(1)%20-%20Copy.docx#_msocom_2" name="_msoanchor_2" data-sf-ec-immutable=""></a>.</li><li>A dependant’s pension – this is paid to a person who depended on you financially for a minimum of 2 years prior to your death. The value of their pension may vary depending on circumstances and will reduce if the eligible dependant is younger than you by 10 years or more.<a id="_anchor_3" href="https://railpen-my.sharepoint.com/personal/jenny_prodanova_railpen_com/Documents/0.Personal/2025/Blogs/What%20happens%20to%20my%20pension%20when%20I%20die/TSR8159%20-HB%20&amp;amp;%20AYB%20comments%20(1)%20-%20Copy.docx#_msocom_3" name="_msoanchor_3"><br data-sf-ec-immutable=""></a></li></ul><h6>Preserved members<br></h6><p>If you’ve left railway employment but haven’t yet reached retirement age and are keeping your pension preserved in the RPS, there are death benefits that could potentially be paid to your dearest and nearest:<br></p><ul><li>A tax-free lump sum death benefit – this may be paid and will be based on the value of your preserved pension</li><li>A spouse/civil partner’s pension</li><li>Eligible child’s pensions</li><li>A dependant’s pension – may still be paid to a spouse, civil partner or eligible children&nbsp;</li></ul><h6>Retired members<br></h6><p>If you die after taking your pension and you pass away, the following death benefits may be paid:<br></p><ul><li>A tax-free lump sum death benefit – this may be paid only if you die within 5 years of retiring and haven’t received the full value of your pension yet</li><li>A spouse/civil partner’s pension will usually be paid – commonly around 50% of your pension.</li><li>Eligible child’s pensions </li><li>A dependant’s pension<br></li></ul><p>Rules vary by section, so check your member guide for more information – it’s in your myRPS account, under ‘My Library’.<br></p><p>There’s also some useful information on <a href="/defined-benefit-members/Im-taking-my-pension/my-pension-when-I-die">the my pension when I die page</a>.</p><h3>&nbsp;</h3><h3>Complete your nominations</h3><p>As a member of the RPS, you are part of one of the UK’s largest and most well-structured pension schemes – and that means your loved ones have a degree of security built in. <br></p><p>To make the most of it, make sure you complete and keep your nominations up-to-date. If you haven’t yet completed them, do it now! <br></p><p>By nominating, you essentially tell the Trustee of the RPS who you’d like to receive a lump sum death benefit in the event of your death. While it’s ultimately a decision of the Trustee, they will consider your wishes. <br></p><p>To nominate, <a href="/my-rps">log into your myRPS account</a><a id="_anchor_5" href="https://railpen-my.sharepoint.com/personal/jenny_prodanova_railpen_com/Documents/0.Personal/2025/Blogs/What%20happens%20to%20my%20pension%20when%20I%20die/TSR8159%20-HB%20&amp;amp;%20AYB%20comments%20(1)%20-%20Copy.docx#_msocom_5" name="_msoanchor_5" data-sf-ec-immutable=""></a>. You can check and update your nominations at any time in your online account.<br></p><p>You might want to inform your family about your RPS membership so they can consider it following your death. </p><p>&nbsp;</p><h3>Tax implications</h3><p>Lump sum death benefits are usually paid tax-free if: <br></p><ul><li>you die before age 75, and </li><li>within 2 years of the Trustee being notified of your death<br></li></ul><p>If you die after age 75 or the lump sum death benefits paid outside 2 years of the Trustee being notified of your death, beneficiaries may have to pay income tax on any lump sum received.<br></p><p>Pensions paid to spouses and/or children are taxable as income in the usual way.</p><div><div><div id="_com_1"><a href="https://railpen-my.sharepoint.com/personal/jenny_prodanova_railpen_com/Documents/0.Personal/2025/Blogs/What%20happens%20to%20my%20pension%20when%20I%20die/TSR8159%20-HB%20&amp;amp;%20AYB%20comments%20(1)%20-%20Copy.docx#_msoanchor_1" data-sf-ec-immutable=""></a></div></div></div>

<h3><span style="background-color: initial; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; word-spacing: normal; caret-color: auto; white-space: inherit"></span></h3><h3><span style="background-color: initial; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; word-spacing: normal; caret-color: auto; white-space: inherit">What is Inheritance Tax?</span></h3><p>Inheritance Tax is a tax on the money, property and possessions someone leaves when they die.</p><p>Most estates don’t pay this tax because they are worth less than £325,000. Anything left to a spouse, civil partner or charity is also exempt.</p><p>If an estate is worth more than the threshold, the tax rate on the extra amount is 40%.</p><div><br></div><h3>What are the current Inheritance Tax rules?</h3><p>At the moment, unused pension savings and death benefits usually don’t count towards the estate and aren’t taxed. There are a few exceptions, such as some NHS and judicial pensions, but most UK pensions are set up so they aren’t part of the estate.</p><p>Because of this, pensions have often been used to pass on wealth without paying tax. For example, someone could save a lot in their pension and use other money for living costs, leaving the pension untouched to pass on tax-free.</p><div><p><span style="background-color: initial; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; word-spacing: normal; caret-color: auto; white-space: inherit">&nbsp;</span></p><h3><span style="background-color: initial; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; word-spacing: normal; caret-color: auto; white-space: inherit">How will Inheritance Tax rules change in 2027?</span></h3></div><p>If an individual dies on or after 6 April 2027 with unused pension savings or death benefits, most of these will count as part of their estate. This is called notional pension property.</p><p>The Personal Representative handling the estate (usually the executor or administrator) will need to include the pension value when working out the estate. They’re responsible for notifying and paying any Inheritance Tax due to HMRC.</p><p>The new rules aim to make inheritance fairer and encourage members to use their pensions for retirement income, as intended.</p><div><p>The government expects around 10,500 more estates will pay Inheritance Tax because of this change.<br></p></div><h3>What counts as notional pension property?</h3><ul><li>Any unused pension pot in a money purchase arrangement, for example, Additional Voluntary Contributions like BRASS or AVC Extra, or funds in a Defined Contribution section, such as IWDC.</li><li>Funds in other pension schemes that haven’t been taken yet, including income drawdown arrangements.</li><li>Lump sum death benefits paid to beneficiaries.</li><li>The balance of any guarantee period for a pension or annuity already started.</li></ul><div><br></div><h3>What is excluded?</h3><ul><li>Death in service benefits if the member was still working – these are exempt from Inheritance Tax.</li><li>Lump sums paid to charities from unused pension pots or drawdown funds.</li><li>Defined benefit pensions (except lump sums from a guarantee period). Pensions paid to a spouse, civil partner, children or dependants are also excluded.</li><li>Trivial commutation lump sum death benefits under £30,000, paid in lieu of a small dependant’s pension.</li><li>Any annuity bought with a pension pot (except the remaining guarantee period) as payments stop after death. Joint life annuities paid to a surviving partner are also excluded.<br></li></ul><h3>How do I make an Inheritance Tax payment to HMRC?</h3><p><span style="background-color: initial; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; word-spacing: normal; caret-color: auto; white-space: inherit">Personal Representatives can ask a pension scheme to hold back 50% of taxable pension benefits if they think Inheritance Tax will be due. They then have 15 months to tell the scheme to pay the tax directly to HMRC.</span></p><p>The Pension Representative is responsible for notifying and paying any Inheritance Tax due to HMRC.</p><div><span style="background-color: initial; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; word-spacing: normal; caret-color: auto; white-space: inherit"></span></div><div><br></div><h3>Find out more</h3><p>For guidance&nbsp;<span style="background-color: initial; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; word-spacing: normal; caret-color: auto; white-space: inherit">on inheritance tax, speak to an Independent Financial Adviser.</span></p><p><a href="https://www.lv.com/" target="_blank" data-sf-ec-immutable="">Liverpool Victoria (LV)</a> has been chosen as the official partner to give RPS members access to financial advice. LV can be contacted on 0800 023 4187. This service is authorised and regulated by the Financial Conduct Authority.</p><p>You can also visit <a href="https://www.moneyhelper.org.uk/en" target="_blank" data-sf-ec-immutable="">MoneyHelper</a> for free, impartial advice backed by the government.</p>