What Happens to Premium Bonds When Someone Dies?
Over £100 million in Premium Bonds prizes remain unclaimed, many belonging to bonds purchased decades ago by people who have since passed away. If a relative has died and you think they held Premium Bonds, here's everything you need to know about claiming them, checking for unclaimed prizes, and understanding the tax implications.
Do Premium Bonds Still Enter Prize Draws After Death?
Yes. Premium Bonds continue entering the monthly prize draws for up to 12 months after the holder's death, or until NS&I is formally notified and processes the estate claim - whichever happens first. This means bonds can win prizes even after someone has passed away, and those prizes become part of the estate.
This is actually helpful for families dealing with probate, as it means there's no immediate urgency to notify NS&I if estate administration is taking time. However, you should still notify them as soon as reasonably practical to avoid complications.
💡 Check for Recent Prizes First
Before contacting NS&I, use our Prize Checker to see if the deceased's bonds have won any prizes in recent months. You'll need their holder's number (found on old prize notifications or NS&I correspondence). Any unclaimed prizes will be added to the estate value when you make your claim.
Can You Inherit or Transfer Premium Bonds?
No. Premium Bonds cannot be inherited, transferred, or gifted to another person. Unlike some investments that can pass directly to beneficiaries, Premium Bonds must be cashed in when the holder dies. The face value of the bonds (plus any unclaimed prizes) becomes part of the deceased's estate and is distributed according to their will or the rules of intestacy.
This is an important distinction from other NS&I products. For example, some NS&I savings certificates can be held jointly, but Premium Bonds are always individual accounts. Even if a spouse or civil partner is the beneficiary, they receive cash, not the bonds themselves.
Once you receive the cash from cashed-in bonds, you're free to buy new Premium Bonds in your own name if you wish - but these will be new bonds with new numbers, not a continuation of the deceased's holdings.
How to Claim Premium Bonds from a Deceased Relative
The process for claiming Premium Bonds depends on the size of the estate and your relationship to the deceased.
Step 1: Gather Information
Before contacting NS&I, collect the following if available:
- The deceased's full name, address, and date of birth
- Date of death
- Holder's number (found on old prize notifications, statements, or correspondence from NS&I)
- Approximate holding amount if known
Don't worry if you don't have the holder's number - NS&I can search their records using the deceased's name and date of birth, though it may take longer.
Step 2: Check for Unclaimed Prizes
If you have the holder's number, use our Prize Checker to see if there are any unclaimed prizes from recent months. This can give you a more accurate value of what the estate will receive. NS&I will eventually identify these prizes when processing your claim, but checking yourself speeds things up.
Step 3: Notify NS&I
Contact NS&I using one of these methods:
- Online: Complete the NS&I bereavement claim form - no NS&I account required
- Phone: 08085 007 007 (8am-8pm Monday to Friday, 8am-6pm Saturday and Sunday)
- Post: NS&I, Sunderland, SR43 2SB
NS&I will send you a claim form and explain what documents you need to provide. The requirements vary based on estate size and your authority to act.
Step 4: Provide Required Documents
For total NS&I holdings over £5,000 (including Premium Bonds and any other NS&I products):
- Original death certificate or certified copy
- Grant of Probate (England & Wales) or Letters of Administration (if no will)
- Completed NS&I claim form
For total NS&I holdings under £5,000:
- Original death certificate or certified copy
- Completed small estates claim form (NS&I will send this)
- Proof of identity for the person making the claim
⚠️ Original Documents May Be Required
NS&I typically requires original documents or certified copies, not photocopies. They will return originals to you after processing. If you're dealing with multiple institutions, you may need to request several official copies of the death certificate from the registry office.
Step 5: Receive Payment
Once NS&I receives all required documents, they aim to respond within 11 working days. Payment is made by bank transfer to the executor's or administrator's account. The amount includes:
- Face value of all Premium Bonds held
- Any unclaimed prizes won before death
- Any prizes won in draws after death but before the claim was processed
Inheritance Tax on Premium Bonds
Premium Bonds form part of the deceased's estate for Inheritance Tax (IHT) purposes. The value is straightforward: £10,000 in bonds equals £10,000 towards the estate value. Unlike investments, there's no valuation complexity - bonds are worth their face value.
Whether IHT is due depends on the total estate value and available allowances:
- Nil-rate band: £325,000 in 2025/26 (per person). Estates below this pay no IHT. Married couples and civil partners can combine their allowances for a total of £650,000.
- Residence nil-rate band: Additional £175,000 (per person) when passing your main home to direct descendants (children, grandchildren). This brings the potential total to £500,000 per person or £1 million for couples.
- IHT rate: 40% on the value above the threshold.
Premium Bonds prizes are tax-free during the holder's lifetime, but any unclaimed prizes still form part of the estate value for IHT purposes. So if someone held £50,000 in bonds and had £5,000 in unclaimed prizes, the estate includes £55,000.
Tax Planning Consideration
For individuals with estates likely to exceed IHT thresholds, Premium Bonds may not be the most tax-efficient asset. Unlike pensions (which typically sit outside the estate) or assets that can qualify for Business Property Relief, Premium Bonds will always be included at full value. However, their capital security and liquidity still make them valuable for many estate planning situations.
Common Scenarios and How to Handle Them
The Deceased Never Told Anyone About Their Bonds
This is surprisingly common. Many Premium Bonds prizes go unclaimed because families don't know the bonds exist. If you're clearing someone's estate, look for:
- Old prize notifications or NS&I letters
- Bank statements showing payments to NS&I
- References to bonds in old tax returns or financial documents
- Physical Premium Bonds certificates (bonds bought before 2004 had paper certificates)
If you suspect someone held bonds but have no proof, you can contact NS&I with the deceased's details and ask them to search their records. They will confirm whether any holdings exist.
You've Found Very Old Premium Bonds
Premium Bonds have no expiry date. Bonds bought in 1957 (when they launched) are still valid and continue entering the monthly draws. If you've found very old bonds or paperwork, they may still have value. The oldest unclaimed prize on record dates back to 1957 and is worth £25.
Very old bonds may have paper certificates. These are still valid - contact NS&I with the certificate details and they'll process the claim. The bonds may also have won prizes over the decades that were never claimed.
The Deceased Lived Abroad
UK Premium Bonds can only be held by UK residents or British nationals living abroad. If the deceased was living abroad when they died, the claim process is the same, but you'll need to provide additional documentation depending on where they lived and where probate is being granted.
Contact NS&I's overseas team for specific guidance - requirements vary by country. Payment can be made to overseas bank accounts, though currency conversion and transfer fees may apply.
Multiple People Want to Claim the Same Bonds
Only the legally appointed executor or administrator can claim Premium Bonds on behalf of an estate. If there are disputes about who should receive the money, these need to be resolved through the probate process. NS&I will only release funds to the person with legal authority - they won't get involved in family disputes.
Unclaimed Prizes: A Hidden Problem
Of the £100+ million in unclaimed Premium Bonds prizes, a significant proportion belong to deceased holders whose families never knew the bonds existed. Common reasons prizes go unclaimed:
- Address changes: The deceased moved house and never updated NS&I with their new address, so prize notifications went to the old property.
- Forgotten holdings: Bonds bought decades ago and forgotten about, especially small amounts purchased as gifts.
- Lost paperwork: No record of the holder's number or NS&I account, making it impossible for families to check.
- Prize cheques not cashed: Prizes paid by warrant (cheque) that expired before the holder's death.
💷 Check for Unclaimed Prizes
If you're dealing with a deceased person's estate and they held Premium Bonds, always check for unclaimed prizes using their holder's number. Our Prize Checker can search all prize values instantly. Prizes never expire - even decades-old prizes can still be claimed by the estate.
Timeline: What to Expect
A typical timeline for claiming Premium Bonds from a deceased relative:
- Week 1: Locate Premium Bonds information and contact NS&I
- Week 2: Receive claim forms from NS&I
- Weeks 3-8: Obtain death certificate and Grant of Probate (if required)
- Week 9: Submit all documents to NS&I
- Weeks 10-11: NS&I processes claim and sends payment
The probate process is typically the longest part. If the total NS&I holdings are under £5,000, the whole process can be completed in 4-6 weeks. Larger estates requiring probate may take 3-6 months depending on complexity.
Practical Tips for Executors and Next of Kin
✅ Do
- Check for unclaimed prizes before making your claim - they add to the estate value
- Keep a record of all correspondence with NS&I
- Request official copies of the death certificate upfront - you'll need multiple
- Ask NS&I to search by name if you don't have the holder's number
- Keep the bonds in draws for a few extra months if probate is delayed - they might win
❌ Don't
- Assume bonds don't exist just because you can't find paperwork
- Cash bonds in your own name - they must be claimed by the executor
- Delay notifying NS&I for more than 12 months after death
- Forget to check very old correspondence - even 50-year-old bonds are valid
Frequently Asked Questions
What if I can't find the holder's number?
Contact NS&I with the deceased's name, date of birth, and last known address. They can search their database and identify any holdings. This may take 2-3 weeks longer than if you have the holder's number, but it's completely possible.
Can I keep checking the bonds for prizes while dealing with probate?
Yes, and you should. Bonds stay in draws for up to 12 months after death, so they may continue winning prizes. Any prizes won become part of the estate. Use our Prize Checker monthly to see if the bonds have won.
What happens if the estate is insolvent?
Premium Bonds are an asset of the estate and must be declared. NS&I will pay the bond value to the administrator, who then distributes it to creditors according to insolvency law. Bonds cannot be transferred to beneficiaries to avoid creditors.
Do I need to tell NS&I immediately after someone dies?
There's no legal requirement to notify NS&I immediately - bonds stay in draws for up to 12 months anyway. However, it's sensible to notify them as soon as you have the death certificate and know what's in the estate. This stops the 12-month clock and ensures prizes are correctly allocated.
Can I buy Premium Bonds with my inheritance?
Yes, once you receive the cash from cashed-in bonds, you can buy new Premium Bonds in your own name. The maximum you can hold is £50,000. These will be new bonds with new numbers - you're not inheriting the deceased's bond numbers or their winning history.
Check for Unclaimed Prizes
If you're dealing with a deceased relative's Premium Bonds, check for unclaimed prizes first. You might find wins from recent months that add to the estate value.
Disclaimer: This article provides general information about claiming Premium Bonds from deceased estates. It is not legal or financial advice. Estate administration and inheritance tax are complex areas - consult a solicitor or tax advisor for guidance specific to your situation. Information accurate as of February 2026.