When someone dies, their bank will need to be notified of the death, and their account(s) will be frozen. This means that direct debits and standing orders for paying household bills and other expenses will be cancelled. For this reason, it’s essential also to notify the utility companies of the death so that they can make allowances for this.
The deceased person’s Estate will still be liable for any outstanding bills, and these will be dealt with as part of the Probate process.
What if the Bank isn’t notified?
Some people contact us to ask if they should refrain from notifying the bank of the account holder’s death because they want the direct debits for household bills to continue. However, it’s essential to notify the bank of the death as soon as possible, so that the deceased person’s account is protected and companies do not continue taking direct debit payments for services that are no longer being used.
If the bank isn’t notified of the death and payments continue. As a result, then these may not be recoverable, for example, subscriptions or charity donations. Also, if accounts aren’t frozen, then their finances could be at higher risk of fraud.
How to notify the Bank of the Account Holder’s Death
First, you will need to establish who has the legal authority to close the accounts. If there’s a Will, then this will name one or more ‘Executors’ who are the people responsible for winding up the deceased person’s affairs. If there’s not a Will, then the Rules of Intestacy set out a list of priority governing who can inherit from the Estate and apply to deal with the administration, depending on what family survive the deceased and what assets are left to deal with. The person at the top of this list will be the ‘Administrator’ meaning they have the legal authority to carry out this role.
The role of Executor is broadly similar to the role of Administrator.
As Executor or Administrator, your first task will be to register the death, so that the registrar can issue the death certificate. You can then contact the bank (or banks) in question to notify them of the death.
The bank will ask to see a copy of the death certificate and some form of proof that you have the legal authority to deal with the deceased person’s accounts. If there’s a Will, then you can take this as proof, along with your identification to show that you are the named Executor. If there isn’t a Will, you can take proof of your relationship to the deceased (such as a birth certificate or marriage certificate).
The bank will then freeze the account and stop all standing orders and direct debits. It’s essential for you to contact the utility companies at this stage to notify them of the death and also advise that the direct debit payments have been cancelled. The utility company will then send outstanding bills to you to settle out of the Estate instead.
If the bank account was held jointly with another person, then the bank will transfer the account into the name of the surviving co-owner on production of the death certificate.
Will Probate be needed to close Bank Accounts?
Once the bank accounts have been frozen, the money will not automatically be released by the bank. This is because a legal document called a Grant of Probate may be required. Some banks agree to release small amounts of money without a Grant of Probate, but if the deceased held a significant amount of money with the bank, then it’s likely that a Grant of Probate will be needed.
Each bank has their own threshold for Probate, ranging from $5,000 to$50,000. If the account contains less than their threshold, they will release this money without needing a Grant of Probate. If the amount of money in the account falls above this threshold, then you’ll need to apply to the Probate Registry for the Grant of Probate before the bank releases this.