Pension lump sum...is it taxable?

A question about : Pension lump sum...is it taxable?

Hello everyone.

My dad died roughly one year ago to the day. It was all very sudden and is still difficult. He had left a will which left everything to my mum.

His workplace pension paid out a lump sum of around Ј35000 to my mum. She is terrified that the tax man is going to send her a letter demanding her to pay tax on it. She hasnt declared it to the taxman yet, it is currently sitting in a savings account doing nothing as she is very worried about the tax man coming knocking. So....

1. As i understand it, the tax man can't touch it because its under the threshold. Am i correct?

2. Does it need declaring and if so, how do you do this?

Many thanks for all your help and guidance.

James

Best answers:

• Thanks for the swift and thorough reply.
  Mum doesnt receive any benefits as she works full time and doesnt qualify for any. As for notifying the tax authorities, do they need to be told about the lump sum and if so how?
  Once again, many thanks