What happened

In March, we announced that in some cases where a person’s estate had made a bereavement claim, they didn't receive the full amount owed to them.

This happened because the search process we had used to handle these claims didn’t find all the savings accounts held by someone when they died.

We’ve since made changes to this process to make sure it doesn't happen again.

We’re extremely sorry for this error and we’ve now set out a plan to make sure those affected by this issue are repaid what's owed to them.

When we will make repayments

We started to send letters to those affected from 27 May 2026 and payments followed soon after.

Letters have been dispatched weekly and we expect to finish contacting people’s estates in the first half of 2027.

How we will contact estates

We are contacting the personal representatives or executors of those estates affected with holdings of £10 or more. Amounts below £10 will still be returned if an estate contacts us.

We’ll write to explain what has happened and to confirm the amount we’ll repay, plus any interest. Payment will then follow shortly after.

If an affected estate needs to get in touch, there is a dedicated phone number included in the letter to help answer any questions.

We want to reach as many people’s estates as possible. If for any reason we can’t get in touch, we’ll continue to hold the money, and any interest being earned, until the estate can be repaid.

What an estate will be paid

We’ll contact any affected estates with holdings of £10 or more to reunite them with the full amount that should have been returned earlier.

To make sure estates haven’t been disadvantaged by the delay, this will then be adjusted upwards to include either the higher of:

• the interest accrued since the error occurred, or
• the Bank of England base rate plus one percentage point, in line with Financial Ombudsman Service principles.

Additional costs of a repayment

We know that some people’s estates may have to pay additional costs because of an unexpected repayment.

When we contact an estate, we’ll also set out a process to submit a reimbursement claim for reasonable costs, with these considered on a case-by-case basis.

Tax exemption

The Minister for Pensions, Torsten Bell MP, confirmed in Parliament on 19 May 2026 that there will be a full Inheritance Tax exemption for any returned holdings affected by the tracing error.

Personal representatives or executors will also not be liable for any Income Tax normally due on interest accrued before death or in the administration period.

We're working with HMRC to ensure that executors, personal representatives and beneficiaries don't have any unnecessary administrative burdens or costs where tax is not due.

Response times for current bereavement claims

If you’ve recently made a bereavement claim, or have an ongoing claim, you don’t need to do anything. The issue has been fixed for these claims.

Our new bereavement claims tracing process is more thorough and takes longer to carry out.

Unfortunately, this meant that our response times temporarily worsened over the spring and early summer to eight weeks while we trained more staff to manage claims.

We've now considerably improved our response times and aim to respond to new claims within 14 days.