Premium Bonds Death UK (2026): What Happens When the Holder Dies?

Premium Bonds do not pass by survivorship or automatically transfer to a beneficiary. They form part of the deceased's estate and must be dealt with by the executor or administrator. NS&I (National Savings & Investments) must be notified of the death. The executor then has two options: (1) cash in the bonds and have the proceeds paid to the estate; or (2) if the beneficiary entitled under the will or intestacy is eligible to hold Premium Bonds, arrange a transfer of the bonds into the beneficiary's name — this preserves the bonds without encashing them. Premium Bonds cannot be transferred to a person who is not already a UK resident aged 16 or over; they cannot be transferred to a trust or a company. Bonds left uncashed will continue to be entered into the monthly prize draws for up to 12 months from the date of death — after that, they are automatically cashed in by NS&I and the proceeds held for the estate. The executor should act before the 12-month deadline to avoid administrative complications.

Yes — Premium Bonds remain eligible for the monthly prize draw for up to 12 months after the bondholder's death. Every bond number has the same chance of winning as it did during the holder's lifetime. Any prizes won after death belong to the estate and must be declared to HMRC as part of the estate's income during the period of administration; the executor is responsible for collecting them and including them in the estate accounts. The NS&I prize checker can be used to identify any unclaimed prizes. After 12 months from the date of death, any un-cashed bonds are automatically withdrawn from the prize draw and NS&I will hold the cash proceeds; the executor can claim these at any time thereafter. There is no time limit for claiming the proceeds of deceased holders' bonds from NS&I, but the bonds stop winning prizes after the 12-month window closes.

It depends on the total value of the deceased's NS&I holdings. NS&I has a small estate limit: for estates where the total NS&I savings (across all NS&I products — Premium Bonds, fixed-interest savings certificates, income bonds, direct saver, etc.) are below £5,000, NS&I can release the funds without a formal Grant of Probate, on receipt of a death certificate and a completed NS&I claim form (signed by the executor or next of kin). For NS&I holdings above £5,000 in total, a Grant of Probate (or Letters of Administration for an intestate estate) is required before NS&I will release the funds. Each financial institution has its own small estate threshold — NS&I's £5,000 limit is considerably lower than most high street banks (which typically have thresholds of £15,000–£50,000). If the total estate is small and the Premium Bonds are the only NS&I holding, the executor should check whether the total is above or below the £5,000 threshold before applying for probate.

The process for notifying NS&I of a death is: (1) Complete and submit a bereavement claim online via the NS&I website, or request a paper form (NS&I Form DIN1 or the relevant bereavement claim form). (2) Provide a certified copy of the death certificate — NS&I will accept a certified photocopy. (3) Provide the Grant of Probate or Letters of Administration if the total NS&I holdings exceed £5,000. (4) Provide a list of the deceased's Premium Bond numbers if known (found in the bondholder's records or via NS&I's bond finder tool using the holder's name, postcode, and date of birth). (5) Specify whether you want to encash the bonds or transfer them to a named beneficiary. NS&I processes bereavement claims within approximately 10 working days of receiving all required documents. Funds are paid by BACS transfer to the estate account. The Tell Us Once service can also be used to notify multiple government departments of a death in a single step, though NS&I requires its own separate claim process.

Yes — Premium Bonds are counted as part of the deceased's estate for inheritance tax purposes at their face value (the amount of money invested, not including any prizes that happened to be won before death). Premium Bonds have no IHT exemption. The face value of all outstanding bonds is included on form IHT400 (schedule IHT417 for National Savings and Investments). There is no discount, no IHT relief, and no exemption specifically for Premium Bonds. Any prizes won after death but before the bonds are cashed are income of the estate during administration and must be reported on the estate's self-assessment return, but they are not subject to income tax for the first 12 months of the 'continuing account of a deceased person' treatment — they form part of the estate assets for distribution. The one IHT planning point: bonds held for less than 7 years before death are within the estate; there is no way to hold Premium Bonds outside the IHT estate, unlike life insurance written in trust.

Yes, subject to eligibility. Premium Bonds can be transferred in-name to an eligible beneficiary without being cashed in, preserving the bond numbers and their continued eligibility for prize draws during the 12-month period. To be eligible to receive the transferred bonds, the beneficiary must be: a UK resident; aged 16 or over (or a child aged under 16 with a responsible parent/guardian who holds bonds); and able to hold the bonds in their own name. The transfer is arranged via the NS&I bereavement claim process: the executor specifies the beneficiary's details and the transfer is made after the claim is processed. The transferred bonds retain their original purchase dates and bond numbers. Joint holdings: Premium Bonds cannot be held jointly — each bond is in a single name only. If the deceased held bonds for a child (as registered guardian), the guardian's details must be updated to a surviving guardian or the child if now 16 or over.

Unclaimed prizes from before the death form part of the estate and must be claimed by the executor. NS&I holds unclaimed prizes indefinitely — there is no time limit for claiming them. The NS&I prize checker tool can be used to search for all unclaimed prizes by bond number. Additionally, the NS&I bond finder can be used to locate bonds where the holder's records are incomplete or lost: search using the holder's name, postcode (past or present), and date of birth. Unclaimed prizes should be included in the estate accounts and distributed to beneficiaries in the normal way. Prize money won before death is estate income for IHT valuation (it increases the estate value); prize money won after death belongs to the estate as income during administration. The executor should complete a prize claim form for any prizes won after death before the bonds are cashed in or the 12-month window closes.