Premium Bonds and staying in the draw

GenX0212

Hi,

Apologies if this has been asked before, I tried searching but couldn't find the question I am trying to ask.

Last surviving parent has sadly just passed and has left ~£20k worth of Premium Bonds.
Due to the size of the overall estate we will be applying for probate.

The wording on the NS&I website seems a little contradictory:
"If the deceased's Premium Bonds stay in the draw, which they can for up to 12 months (instead of being repaid), who will receive any prizes won?"
but also 
"We can’t pay these prizes electronically or consolidate them and pay them at the end of the 12 months"

If we claim them immediately then do prizes still continue to accrue and be paid to the estate until NS&I complete the claim or do we have first have to opt for them to stay in the draw for this, if the latter then do we have to wait a full twelve months to claim the money or can we ask for it once all other parts of probate are completed?

Hope the question makes sense, apologies if not as head is a bit mashed by everything a the moment. Thanks.

Tescodealqueen

Sorry for your loss.

My mum died over 20 years ago and dad just this week told me about a small premium bond holding! I had no idea but went online and filled in a form for repayment and there was a box to tick about the 12 month run on. This is probably your best way forward.the form explains everything as you go forward

Luckily she hadn’t won so I didnt  have to say to him this is what you could have won.

poppystar

Thats really odd as they specifically kept hold of all wins on my father’s bonds until the end of the twelve months and then paid the total value to me - in a separate payment to the cash value of the total holding, but none the less at the same time. 

Is it possibly something to do with Probate? It took a long time to obtain probate so nearly the year anyway so maybe they only start paying in the way they say here after they have seen sight of probate? Then pay monthly not consolidating as that excerpt suggests? 

Certainly for now fill in the form and request the bonds stay in for the twelve months if that is what you want. Im not sure if you change your mind and want the bonds cashed in earlier that they will then do that, might be best t9 ask them before you fill in the form if that is important to you. 

ColinGala

"We can’t pay these prizes electronically or consolidate them and pay them at the end of the 12 months".

If you want to continue receiving prizes then you must opt into them staying in the 12 month draw. The monthly prizes are paid by a 'Warrant Cheque' (this means the cheque can only be put into the nominated Executor account).  At the end of 12 months they transfer electronically the original investment to the nominated Executor Account which can then be distributed to beneficiaries.So the Executor Account is the beneficiary for any prize money

If you don't opt in then you won't be in the draw for any prizes and have to wait until Probate has been granted before they send you the original investment. I think (am not 100% sure) you have to wait for the full 12 months before they repay the original investment.

The advantage of staying in the draw is that the prizes are not part of the taxable estate (so are not included in IHT assessments) and, as the prizes are tax free, they are not counted as taxable income when reporting any gain in the Executor Account

DavidT67

If you want to continue receiving prizes then you must opt into them staying in the 12 month draw. 

If you don't opt in then you won't be in the draw for any prizes

The advantage of staying in the draw is that the prizes are not part of the taxable estate (so are not included in IHT assessments) and, as the prizes are tax free, they are not counted as taxable income when reporting any gain in the Executor Account

This was not our experience.

We did not elect to keep the bonds in the draw for twelve months, but they remained in the draw on a month by month basis until probate was granted and we submitted the relevant form for their release.  

At which point we received a dozen individually posted bank warrants for prizes won since death and the BACS transfer into the personal representatives account.

ColinGala

This demonstrates how confusing NS&I advice is...If you do not elect to keep the bonds in the draw they keep them in anyway and send you any prize money! Although it worked out fine for me in the end it caused me a few sleepless nights of worry as to what exactly was going to happen. Glad it worked out for you too!