Cash Clinic: Taxing question over late wife's pension pay-outs

Q: MY WIFE died 18 months ago and I am continuing to receive payments from her private pension. I have called the company and told it that the circumstances have changed.

It said it was aware of her death, that the payments have been stopped and that they have no record of any further payments being made.

However, the payments are still being made and my concern is that the company will, at some point in the future, ask for the money back. What should I do?

WW, Kelso

A: If the amounts of the payments changed after your wife died, it may be that you are entitled to a widower's continuing pension under your late wife's scheme. If so, it is important to ensure that HMRC is aware that you are receiving this new pension so that it can take account of it in your tax code to ensure that the right amount of tax is deducted from it each month.

If you are not entitled under the scheme, it seems that there has been a breakdown in communications - probably between the company and the pension provider. I suggest you contact the pension provider about the payments and ask why they are still being made.

• Neil Whyte is a tax partner with accountants and business advisers PKF. If you have a question you need answered, write to Jeff Salway, The Scotsman, 108 Holyrood Road, Edinburgh EH8 8AS or e-mail: [email protected].