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The Universities Superannuation Scheme (USS) is the pension scheme for academic and professional services staff at UK universities and higher education institutions. It is one of the largest private sector pension schemes in the UK, operating as a defined benefit (DB) scheme for most members. When a USS member dies, their family can claim a lump sum death benefit and an ongoing pension for dependants. These benefits fall outside the estate and do not normally require probate.
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In most cases, no. USS holds death benefits within a discretionary trust. The trustees can pay the lump sum directly to the nominated beneficiary without requiring a Grant of Probate. The funds fall outside the deceased's estate precisely because the member had no absolute right to direct who received them.
Where there is no nomination and no eligible dependants, USS may pay the lump sum to the estate. In that case, you may need to apply for probate before the funds can be distributed.
A surviving spouse, civil partner, or financially dependent partner receives an ongoing pension — typically around 50% of the member's pension entitlement. This is paid for life and is subject to income tax. Eligible children receive a children's pension until age 23 if in full-time education.
USS members are strongly encouraged to complete a nomination form (expression of wishes) specifying who should receive the lump sum death benefit. The USS trustees place significant weight on this nomination but retain discretion — they are not legally required to follow it. This is what keeps the funds outside the estate for IHT purposes.
The nomination should be updated whenever personal circumstances change — for example, after marriage, divorce, or cohabitation. An outdated form naming a former partner or a deceased person can cause delays and unexpected outcomes.
The spouse's or partner's pension is paid automatically under USS rules to an eligible dependant — it is not subject to the nomination form.
For the latest guidance, visit GOV.UK's page on tax on pension death benefits.
Currently, USS pension death benefits fall outside the estate and are not liable to inheritance tax. The government has announced that from 6 April 2027, pension funds will come within the scope of IHT — but USS operates primarily as a defined benefit (DB) scheme, not a defined contribution (DC) pot.
The April 2027 changes primarily target unspent DC pension pots. The USS DB section pays a lump sum death benefit and an ongoing spouse's or partner's pension — it does not hold an accumulated pot in the way a SIPP or workplace DC scheme does. How the new rules will apply to DB death benefits and survivor pensions is still subject to HMRC guidance. For deaths before April 2027, the current rules apply. Read our guide to pensions and inheritance tax from April 2027 and the inheritance tax guide for 2026/27.
If no nomination form is on file, USS trustees will exercise discretion. The lump sum will usually be paid to the surviving spouse or civil partner. If there is no surviving spouse and no eligible dependants, the benefit may be paid to the estate, triggering the probate process and potentially inheritance tax.
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