Customer accounts after death

Hello! I am Gemma, a legal assistant here at Lawyer Destroyer. Dealing with a loved one's accounts after they pass away can feel overwhelming, but the process is actually quite structured. Here is a clear breakdown of what happens and what needs to be done under the law in England and Wales.

First, notifying the bank.
As soon as the bank is formally told about the death, they will update their records. You can usually do this by providing them with the death certificate. To make things easier, there is a brilliant free tool called the Death Notification Service, which lets you notify multiple major banks and building societies at the exact same time online.

Second, sole accounts are frozen.
If the account was only in the deceased person's name, the bank will freeze it immediately. This stops any money from going in or out and protects the account from fraud. All direct debits and standing orders are cancelled.

However, banks are usually very practical when it comes to immediate essential costs. If you give them the funeral director's invoice, they will normally pay the funeral costs directly from the frozen account, provided there is enough money in there. They can also release funds directly to HM Revenue and Customs to pay inheritance tax, or to HM Courts and Tribunals Service for probate application fees.

Third, joint accounts are treated differently.
If the deceased had a joint account with someone else, like a spouse or a partner, the money almost always passes automatically to the surviving account holder. This is known legally as the right of survivorship. The bank will simply remove the deceased person's name from the account once they see the death certificate, and the survivor can carry on using the account and the money as normal.

Fourth, releasing the money from sole accounts.
How the money is eventually released depends entirely on how much is in the account.

For smaller amounts, you might not need official court documents. Every bank sets its own threshold, but generally, if the balance is under something like 20,000 to 50,000 pounds, the bank might release the funds to the closest relative or the person named in the will. You will just need to sign a legal form called an indemnity, which promises you will repay the money if it turns out someone else was actually entitled to it.

For larger amounts, the bank will ask to see a Grant of Probate, if there is a will, or Letters of Administration, if there is no will. This is a legal document issued by the probate court proving exactly who has the legal authority to close the accounts and collect the money. Getting this document involves filling in forms about the person's estate and swearing an oath or statement of truth.

Fifth, paying debts and sharing the rest.
Once the bank releases the money to the legally responsible person, who is called the executor or administrator, the money does not just automatically belong to them. They must first use those funds to pay off any outstanding debts or taxes the deceased had. Only after all debts are settled can the remaining money be safely shared out among the beneficiaries according to the will, or according to the strict legal rules of intestacy if there was no will.

Because the exact steps depend on which bank you are dealing with, whether there is a valid will, and how much money is involved, it is always a sensible first practical step to call the specific bank's bereavement team. They are trained to be very supportive, they deal with this every day, and they will tell you exactly what paperwork their specific bank requires.

I hope this helps make things a bit clearer! Please let me know if you have questions about a specific type of account or situation.