What happens to Premium Bonds and ISAs when you pass away (UK)
1 August 2026 · Inherit Vault
"Savings" sounds like one category. For inheritance purposes it's several, each with its own rules, and the differences catch almost every family off guard.
Premium Bonds
NS&I doesn't cash these in automatically, and here's the surprising part: Premium Bonds keep entering the monthly prize draw for up to a year after death, an executor can choose to leave them in as long as that window allows, or cash them in immediately. Notifying NS&I is simple, a death certificate and some ID, but the "keep them entered" option is one almost nobody knows exists unless they ask. Our guide to Premium Bonds after the holder passes away explains the draw rule and how prizes are paid.
Cash ISAs
An ISA keeps its tax-free status for a while after the holder passes away. It ends when the executor closes it or the estate is finished. If neither happens first, the provider closes it 3 years and 1 day after the date of death.* Until then, there is no Income Tax on the interest.* The money still counts as part of the estate for Inheritance Tax. A surviving spouse or civil partner can also claim an "additional permitted subscription", broadly equal to the ISA's value, letting that amount go into their own ISA tax-free. Anyone else inheriting an ISA does not get this extra allowance.
Stocks and shares ISAs
The same tax-free period applies. There is no Capital Gains Tax on growth until the ISA is closed, the estate is finished, or 3 years and 1 day have passed.* The investments still need a value for probate, at their market value on the date of death. What they were bought for does not count. Our guide to shares and investment accounts after someone passes away explains how the broker deals with them.
Premium Bonds and ISAs both sit outside the will's control in one specific sense, they don't need probate to identify who they belong to, that's already fixed, but they do need probate before the executor can actually access or cash them in for most estates above the small-estates threshold.
The common thread
None of these products send a letter when the holder passes away, they wait to be told, sometimes for years, which is exactly how so much of the UK's billions in unclaimed savings ends up unclaimed: not hidden, just never reported. A one-line note, "I hold £X in Premium Bonds, provider Y", costs nothing to write and can be the only reason it's ever found at all.
*Correct at the time of writing, 30 October 2026. These can change, so check with the organisation before you rely on them.
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