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NS&I bereavement claims update · UK-wide

NS&I Bereavement Claim Error: What Executors Should Do If an Estate Is Contacted

NS&I is contacting certain estates after an historic tracing process failed to identify every savings account held by some customers who had died. Here is how to verify the contact, record the repayment and understand the proposed tax relief.

Published and last checked 29 October 2026 · 8-minute read

Verify an unexpected approach independently. Use contact details found by navigating to the official NS&I website yourself. Never disclose passwords or one-time security codes, and do not pay an upfront fee to “release” a repayment.

What was the tracing error?

When an estate submitted a bereavement claim, NS&I's historic tracing process did not always find all the deceased customer's savings accounts. Some estates were therefore paid less than they should have received.

NS&I says it has strengthened the process for current and new bereavement claims. People who have recently submitted a claim, or have one in progress, do not need to take additional action because of this historic error.

Which estates are being contacted?

NS&I is contacting the legal representatives of affected estates where the unreturned holdings total £10 or more. Letters began on 27 May 2026, are being dispatched in weekly batches and are expected to continue during 2027.

The letter should explain what happened, identify the repayment and interest, and provide a dedicated telephone number. If NS&I cannot reach an estate, it says it will continue to hold the money and any interest being earned until repayment can be made.

What should an affected estate receive?

The estate should receive the full amount that ought to have been returned earlier. NS&I says it will increase that amount using whichever of the following produces the higher figure:

  • the interest accrued since the error occurred; or
  • the Bank of England base rate plus one percentage point.

Keep the letter, calculation and bank record with the estate papers. If the estate has already been distributed, record how the newly received money is handled and obtain advice if entitlement is unclear.

Can additional costs be reimbursed?

NS&I recognises that an unexpected repayment may cause an estate to incur extra costs. Its letter will explain how to submit a reimbursement claim for reasonable additional costs.

Claims are considered case by case; reimbursement is not automatic. Keep invoices, receipts, professional correspondence and an explanation showing why each cost arose from the delayed repayment.

What is the intended tax treatment?

Budget 2026 and the Overview of Tax Legislation and Rates confirm the government's intention to prevent affected estates from facing disproportionate tax and administrative burdens. The announced treatment includes:

  • a full Inheritance Tax exemption for qualifying holdings of the remediation population affected by the tracing error; and
  • an Income Tax easement so personal representatives are not liable, in that capacity, for tax that would otherwise arise on interest accrued before death or during the administration period.
Legislation is still required. Finance Bill 2026–27 is intended to create a regulation-making power. The detailed reliefs must then be delivered through secondary regulations. The power is expected to take effect from Royal Assent to the Finance Act 2027. Regulations may operate retrospectively, but cannot increase a person's tax liability.

Until the legislation and regulations are in force, executors should preserve all NS&I and estate records and check current official guidance before changing an earlier tax return, reopening estate reporting or distributing the payment.

Executor checklist

  1. Verify the communication independently. Navigate to NS&I's official website and use its published contact route.
  2. Match the estate details. Check the deceased person, representative, claim and reference against the estate records.
  3. Review the calculation. Retain the breakdown of the holding, interest adjustment and any other payment.
  4. Protect the bank trail. Where possible, handle estate money through an appropriate estate or executor account.
  5. Preserve evidence of costs. Keep invoices and show how each cost arose from the remediation payment.
  6. Confirm entitlement. Review the will, intestacy position, estate accounts and earlier distributions.
  7. Check the final tax rules. Do not assume the announced relief is already operational.
  8. Update the estate records. Record the letter, payment, decisions and distributions.

Fraud precautions

  • Use only the official nsandi.com website to find contact details.
  • Treat unexpected emails, texts, social-media messages and urgent demands with caution.
  • Never disclose an NS&I password, security code or online-banking credentials.
  • Never pay an upfront “release”, “tax clearance” or administration fee.
  • Independently verify any request to change bank details.

NS&I says it is contacting affected legal representatives directly. A third party cannot guarantee a faster repayment or reimbursement of its fees.

Frequently asked questions

Do executors need to submit a new claim?

NS&I says it is proactively contacting affected legal representatives where the unreturned holdings total £10 or more.

What if the estate was already distributed?

Keep the money separate while checking the will or intestacy position, earlier accounts and who is entitled. Obtain advice if the correct distribution is uncertain.

Will NS&I automatically reimburse professional costs?

No. Reasonable additional costs may be claimed, but NS&I will assess them case by case.

Are the announced tax exemptions already in force?

The intended reliefs have been announced, but Finance Bill 2026–27 and subsequent regulations must implement the detail.

Official sources

This article provides general information based on the official sources above as checked on 29 October 2026. The proposed tax reliefs require legislation and secondary regulations and may change before implementation. This is not legal, tax or financial advice. Executors, administrators and beneficiaries should check current official guidance and obtain advice appropriate to the estate.