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Following a death, the deceased person’s bank will need to be notified. This will start the process of their bank accounts being frozen and later closed. Dealing with this situation can be upsetting and stressful. Be reassured that banks and financial institutions are very conscious and aware of the difficulties you will be facing. As such, these institutions usually have specialist bereavement teams that are skilled in liaising with bereaved family members.
Each bank or building society will have its own process to follow that may differ from other providers. Here is a guide to the general steps you will need to follow when closing bank accounts after someone has died. It also considers some of the documentation you will require to complete this task.
As this will be a very difficult time for you, why not ask a family member or trusted friend to help you through this process?
Who can close a bank account after a death?
If the bank account was held as a joint account, it will continue to remain active. The account will pass directly to the sole other account holder, once the bank has been notified of the death. In this case, there is will be no need for closure of the account.
If it was held as a sole account, then the person representing the deceased will usually be the one who can request closure of the account. Initially you will be requesting that the account is frozen. There are further steps required before an account can be fully closed.
If the person had a will, the personal representative of the deceased will be the executor named in the will. If there is no will, it will be the administrator of the estate who can request the closure.
The executor or administrator is the person authorised to deal with and distribute the deceased’s assets and estate. It falls to this person to resolve the deceased’s finances. In either situation, you may need to apply for a grant.
Obtaining a grant of representation
The bank may require a copy of a grant to be issued before allowing any money to be withdrawn from an account. A grant is a legal document that demonstrates you have the right to settle the estate of the deceased. The type of grant will vary depending on whether the person had a will and where they resided in the UK. If any type of grant is required, it is usually referred to as needing Probate.
You can do apply for probate yourself if you feel able to and the person’s affairs were fairly straightforward. You may prefer to ask a Solicitor or Probate specialist to help you through this process. This can be useful if you are not confident with this task, if the estate is complex or there are contentious issues to resolve.
Here are some links to the relevant websites that can help you:
- If there is a will – you may need to apply for a grant of probate
If there is not a will – you may need to apply for a grant of letter of administration
- In Scotland – you will need to apply for a certificate of confirmation in either event if there is or isn’t a will
- In Northern Ireland visit NI Direct
If inheritance tax is due from the estate, you should discuss this with your bank as soon as possible. Some financial institutions have arrangements to send all or part of any inheritance tax directly to HMRC from the person’s account.
Once you have obtained the relevant probate or confirmation, you will be able to deal with and finalise the deceased’s estate.
Issues to consider when a bank account is frozen or closed
If the account was held in a sole name, you may need to review the regular outgoings from this account at the point of freezing it. There may still be contractual agreements linked to this account by way of regular payments such as via direct debit or standing order.
Obtaining a recent statement or list or regular outgoing payments may help determine what other services will need to be contacted.
Services such as household bills, utility providers, insurances, and telephone and TV service providers may not be aware of the death. When freezing or closing a bank account, this will automatically stop payments for those services.
Go through each of these providers and notify them of the death. This will ensure that the deceased does not start to receive letters for missed payments for services. These demands can cause you further distress in an already difficult situation. You can at that point review if any of those services need to be cancelled or amended.
Withdrawing money from the deceased’s bank account before getting a grant
Banks will be aware that whilst waiting for a grant, you may need to access some of the funds in the deceased’s account. Each Bank will differ so at the point of notification of the death, enquire what their specific process is.
This may include:
- Funeral costs and related expenses
- Buying a Headstone or Memorial
- Payment of Inheritance Tax
- Payment for any Probate fees when applying for a grant
How to close a bank account after a death
The Death Notification Service is a free service that allows you to notify a number of banks, building societies and financial institutions of a death at once. The aim is to make the process easier and quicker for you. You can do this online at a time that suits you.
If you approach the bank provider directly, they will usually ask you to provide proof of your identification. This can usually be a passport, driver’s licence and a utility bill that shows your address. They will also want to see a copy of the will. If there is not a will, they may ask for proof of evidence of your relationship to the deceased.
You will also need to show them the death certificate. This will be issued to you at the point of registering the death. This should also stop any ongoing correspondence from the bank to the deceased too.
The account will be initially frozen. Discuss with your bank how the funds will be released. This usually depends on how much money is in the account and whether a grant is required. Each institution will have a different threshold of what monies they can release without a grant being required.
If the bank does allow you to access the deceased’s bank account without a grant being issued, it is common for them to require you to sign indemnity forms. This is an agreement whereby that you promise to return the money to the bank or estate, if it you did not have the legal authority to access it.
Finding lost bank accounts that belong to the deceased
Depending on how your relationship to the deceased, you may not be aware of all of their bank accounts and financial information. It is also common for people to forget about old accounts and other financial products they had.
If you think there may be lost assets, why not take a look at this useful guide.
My Lost Account can help you trace lost personal accounts.
If you are not sure which bank or building society the deceased held their assets in, this service can help with a useful tracing scheme.
You can request a search for dormant accounts with banks, building societies and NS&I via their website.
Organise your financial and legal affairs
Closing bank accounts is a very difficult yet important process that will be required fairly soon after a death. If you are dealing with this on behalf of someone else and are struggling with this, why not consider your own situation. If someone had to do this for you one day – would they find this process easy? Is there any way you could make this a smoother process?
Remove some of the future guesswork and uncertainty for others by having a clear plan in place.
There are 3 top things you can do now to get help get organised:
- Draft a will and keep it somewhere safe yet accessible
- Organise your financial affairs – make sure people know where your various accounts are held
- Talk to your loved ones – make sure they know how to access your accounts when you are gone
Discuss your sunset plan with those who will need access to this information one day. If you are an executor for a family member, why not discuss this with them now? Even having a general idea of what accounts are where, can help alleviate some of the difficulties when dealing with practical affairs after a death.
This article does not constitute legal or financial advice. It is a general guide to help you work through the process of closing accounts and provides links to relevant services.
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