Commons Sense

House of Commons · Ministers' Questions

Armed Forces: Death-in-service Payments

Monday 10 February 2025 · 3 questions

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Answered 0 Partly answered 2 Not answered 0

Key points

  • Tom Tugendhat asked about removing taxation from death-in-service payments to improve retention in the armed forces.
  • Blake Stephenson inquired if proposed changes to inheritance tax would be compatible with the commitment to ensure armed forces personnel face no disadvantage.
  • Mr Mark Francois asked for the date when the MOD submitted its response to the key consultation and requested the response be placed in the Library.

Topics (select to filter)

Questions & Answers

Q1 Tom Tugendhat Con Tonbridge
Defence Taxation
Context

The issue of death-in-service payments being taxed and its impact on military retention is highlighted. The questioner expresses concern over the clarity of government policy in this area.

Question

If he will have discussions with the Chancellor of the Exchequer on the potential merits of removing taxation from death-in-service payments. Retention in the armed forces is already suffering; numbers are coming down and people are struggling to make the maths add up between serving today and having a future tomorrow. The problem with these arguments and the lack of clarity from the Government is that too many people are making decisions on which we all need them to think again.

Answer from The Minister for Veterans and People (Al Carns)

I thank the right hon. Member for Tonbridge (Tom Tugendhat) for his important question. He has my absolute assurance that if anyone dies in service, from training all the way through to combat and operations, they will absolutely be exempt from inheritance tax provisions. I will continue to discuss that issue, as well as many others to do with armed forces pay, with my opposite number in the Treasury.

Partly answered

Not addressed: The Minister did not provide specifics on the discussions or a clear commitment regarding the removal of taxation from death-in-service payments.

How: We Need To Take A Holistic View, Reminded That We Have Missed Every Recruitment And Retention Target For The Past 14 Years

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Q2 Blake Stephenson Con Mid Bedfordshire
Taxation Veterans
Context

Concerns are raised about the compatibility of proposed changes to inheritance tax with the commitment in the armed forces covenant.

Question

If he will give an assurance that the proposed changes to the application of inheritance tax to certain armed forces death-in-service payments are compatible with the commitment in the armed forces covenant to ensuring that our brave and loyal armed forces personnel face no disadvantage compared to other citizens in the provision of public and commercial services.

Answer from The Minister for Veterans and People (Al Carns)

The covenant will come into law in the next two years or so, on the back of the armed forces Bill. That will result in a great expansion, with all Government Departments falling in line with the covenant, so that no individual who has served is disadvantaged because of that service.

Partly answered

Not addressed: The Minister did not provide an assurance regarding the specific compatibility but spoke generally about the armed forces covenant's goals.

How: Reminded That We Have Missed Every Recruitment And Retention Target For The Past 14 Years

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Q3 Mark Francois Con Rayleigh and Wickford
Defence Taxation
Context

The Forces Pension Society has raised concerns about the proposed changes to death-in-service benefits taxation. The Minister is questioned on when the MOD submitted its response to HMRC's consultation.

Question

On what day did the MOD submit its response to that key consultation—presumably in defence of service families’ interests—and will the Minister place a copy of that response in the Library?

Answer from The Minister for Veterans and People (Al Carns)

May I remind the right hon. Member of my service, and of the fact that I will in no way, shape or form take this for granted? I am putting all my effort into those discussions at the moment. My officials have discussed that with the Treasury, I have discussed it with the Treasury, and we will continue to discuss such issues with the Treasury to ensure that our armed forces personnel get the deal that they deserve.

Not addressed: The Minister did not provide a specific date or confirm if there was any response submitted.

How: Scoring Political Points On The Back Of Armed Forces Families Is Unacceptable

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