What happens to a joint bank account when one of you dies

When someone dies, a lot of their money is effectively paused. Accounts in their sole name are usually frozen until the executor or administrator has the legal authority to deal with them, which can take months. For the person left behind, one question often comes first and quickly: what happens to the joint account the household bills come out of?

The answer is usually reassuring, though it depends on where you live and on who the account holders were. It is worth understanding while everyone is well, because it can shape how a couple, or a parent and adult child, set up their banking.

The basic rule in England and Wales

Most joint bank accounts are held under what lawyers call the right of survivorship. Citizens Advice explains that when one holder dies, all the money goes to the surviving holder without the need for probate or letters of administration. GOV.UK puts it the same way: money owned jointly passes automatically to the surviving owners unless they have agreed otherwise.

Because the money passes outside the will, it does not matter what the will says about it. A joint account is not normally part of the estate that the executor distributes, even though it may still count for inheritance tax, as explained below.

Why Scotland is different

Scottish law treats joint accounts differently. Citizens Advice Scotland explains that for spouses and civil partners the money is generally presumed to belong to them equally, so half may form part of the estate of the person who died. Where only one partner paid money in, it may belong to that person, and the survivor may need to show this. Most banks will still let the surviving holder use the account, depending on the account’s terms.

For joint holders who were not married or in a civil partnership, the executor needs to work out what share belonged to the person who died. The survivor may be able to draw on the account if the bank’s mandate allows it. Anyone in Scotland dealing with a joint account after a death should check with the bank and, where amounts are significant, with a solicitor.

What the bank will need

Citizens Advice notes that the bank may need to see the death certificate. In practice the surviving holder contacts the bank’s bereavement team, which will usually explain the next steps.

1. Tell the bank about the death and give the account details.
2. Show the death certificate, or a certified copy, when asked.
3. Ask the bank to confirm that the account will continue in your sole name and whether any cards or online access need to be reissued.
4. Check which payments go in and out, and whether any relate only to the person who died.

Joint accounts and inheritance tax

Passing outside the will does not mean the money is ignored for inheritance tax. HMRC’s inheritance tax manual explains that each joint holder is treated as owning the share that matches what they paid in. If the person who died provided all the money, the whole balance can count as part of their estate. If they paid in half, half counts.

For married couples and civil partners this rarely leads to tax, because what passes to a spouse or civil partner is usually exempt. HMRC’s guidance says shares do not need to be worked out where the deceased’s interest passes to an exempt beneficiary such as a spouse. The share matters more for unmarried partners, siblings, and parents and adult children who hold accounts together.

Three example households

The third case needs care. Where a parent added a child to an account only so they could help with bills, rather than to give them the money, the position can be less clear-cut, and the money may be treated as belonging to the parent’s estate. The bank, the executor and, if needed, a solicitor can establish what was intended. Whether any tax is due also depends on the size of the whole estate, since the nil-rate band is £325,000.

Overdrafts, payments and other loose ends

• Overdrafts. Joint account holders are each responsible for the whole of any overdraft. Citizens Advice notes that a joint overdraft can still be recovered from the surviving holder.
• Direct debits and standing orders. Bills in the survivor’s name usually carry on as before. Subscriptions or memberships in the other person’s name may need cancelling.
• Payments still arriving. A pension or benefit paid into the account after the date of death may have to be repaid. It is sensible not to rely on those amounts until the payer has confirmed the position.
• Savings and investments. Joint savings accounts usually follow the same survivorship rule; investments and property may be held differently, so each is worth checking.

Telling banks, and telling government

The free Death Notification Service lets you notify a number of participating banks and building societies with a single online form. According to the service, participating firms respond within 10 working days if they hold an account. It covers financial firms only.

Government departments are covered by a separate service. Our guide to Tell Us Once explains how one report at registration reaches HMRC, the DWP, the Passport Office and the local council. Citizens Advice also suggests contacting the DWP Bereavement Service about pension and benefit payments. Energy and water companies need telling too, including updating any Priority Services Register record.

Who this matters for, and what to check

• Couples who rely on one joint account for household bills: check it is genuinely joint, not a sole account with a second card holder.
• Parents who have added an adult child to an account: consider writing down what was intended.
• Anyone in Scotland, where the presumption of equal ownership applies.
• Families thinking about lifetime gifts; see our guide to everyday gifts and inheritance tax.