Executor bank account: what it is, when you need one and how to open one

What is an executor bank account?

An executor bank account is an account held by the executors for the estate, rather than for themselves, into which the money from the person's closed accounts, sold assets and refunds is paid, and from which the estate's debts, taxes, expenses and finally the beneficiaries are paid. You will also see it called an executorship account or an estate account, and administrators appointed by letters of administration can usually open the same kind of account when there is no will.

It is a different thing from the accounts the person held themselves. Those are frozen once the bank is told about the death and are eventually closed, whereas the executor account is a new or converted account in your name as executor. Our guide to what happens to a bank account when someone dies explains the freezing and release process for those original accounts, so this guide picks up at the point where the money has somewhere to go.

Do executors need to open a bank account?

No law says you must, but it is the approach the official guidance points towards and, for anything beyond the simplest estate, it is hard to administer properly without one. GOV.UK's guidance on dealing with the estate says that where there is more than one personal representative you should agree where to hold the financial assets, such as in an executorship account, and MoneyHelper's guide to sorting out an estate says it is worth opening a separate account so the estate's money is kept apart from yours. Citizens Advice also lists opening a bank account on behalf of the estate among the executor's tasks.

The reason is accountability. Under section 25 of the Administration of Estates Act 1925 a personal representative must collect in the estate and administer it according to law and, if the court requires it, produce an inventory and an account, which means you need a clean record of every receipt and payment. A dedicated account produces that record for you, because the bank statement becomes the backbone of the estate accounts you will share with the beneficiaries at the end. Where the estate is a single small balance paid straight to one beneficiary, a separate account may be more trouble than it is worth.

Can an executor use the dead person's bank account instead?

Not in any day-to-day sense, because the person's sole accounts are frozen once the bank knows about the death and nobody can use the cards or online banking, including an executor or someone who held power of attorney. What many banks will do is pay certain bills directly from the frozen account before the grant. Citizens Advice says some banks and building societies will release money needed for the funeral, probate fees and inheritance tax, but nothing else until probate or letters of administration have been granted, and adds that they do not have to release anything, however small the amount.

Inheritance tax is the main example. HMRC's Direct Payment Scheme lets you send money straight from the deceased's bank or building society account to HMRC using form IHT423 alongside the IHT400, which matters because you usually need to pay something towards the tax before you can get the grant. Our guide to paying inheritance tax from the deceased's bank account covers the form in detail. Once the grant is issued, the usual pattern is that you close the person's accounts and have the balances paid into the executor account.

How do you open an executor bank account?

You usually open it once you have the grant of probate, or at least the will, and the bank will want to see the death certificate, the will and the grant together with identification from the executors. Bank bereavement pages commonly ask for photo ID and proof of address from an executor who does not already bank with them, and documents are often checked in a branch rather than online.

The details vary between banks, so ring the bereavement team before you go. Some will only deal with executors who already bank with them, asking you to open a new account in your own name which they then convert into an executor account, whilst others will open one for an executor who is not a customer. Some will open the account before the grant but restrict it, so that it can receive money and perhaps pay the final funeral invoice, with full use unlocked when you send in the grant. In Scotland the equivalent document is confirmation, which the Scottish Courts and Tribunals Service describes as the court's authority for executors to uplift money held by banks and to administer it according to law, and banks there ask for that instead.

MoneyHelper suggests considering a different bank from your own, because deposit protection from the FSCS is up to £120,000 per eligible person per firm (since 1 December 2025), and money from an inheritance can qualify for temporary high balance protection of up to £1.4 million for six months in most cases. After a house sale, check how much will sit in one place and for how long.

How does an executor account work with more than one executor?

Where several executors are acting, the account is normally opened in their joint names, and GOV.UK says you should agree rules between you on making withdrawals or payments from any accounts connected to the estate. In practice that means deciding before you sign the bank's mandate whether any one executor can make payments alone or whether two must approve, because the mandate is what the bank will follow when one of you instructs it.

Banks may cap the number of names on the account, and that limit can be lower than the four executors who can be named on a probate application, so you may need to agree that one or two of you will hold it whilst the others see the statements. Some banks also ask joint executors to open the account together, as a fraud check.

What should go in and out of the executor account?

Everything the estate receives after the death should go in, and everything it pays should go out, with nothing personal passing through it. On the receiving side that typically means closing balances from the person's current and savings accounts, proceeds from selling the house, shares or a car, refunds from utilities, council tax and subscriptions, final salary or pension arrears, and any insurance or pension lump sums that are payable to the estate rather than to a named beneficiary.

On the paying side it covers the funeral if it was not paid directly, debts and final bills, inheritance tax, income tax and capital gains tax, the probate fee and professional costs such as valuations and legal fees, and finally the legacies and residuary shares. The timing of that last step matters. GOV.UK's guidance on settling debts says you should place a notice in The Gazette giving creditors two months to claim and not distribute until that time is up, because if you pay out and the estate then cannot meet a debt, you may have to pay it yourself. Keeping a reserve in the account until the last tax and debts are settled is therefore the safer course, and our guide to what an executor does explains the wider liability.

Is interest on an executor account taxed?

Yes, because interest earned after the death is income of the estate, and the personal representatives are responsible for any tax on it. GOV.UK's page on reporting an estate's income says that if the estate's income from all sources is £500 or less in a tax year, you do not need to report it to HMRC, and that £500 cannot be carried over to another year. ISAs held by the person continue to be exempt from income tax and capital gains tax until the estate is closed or up to three years after the death.

Above that level tax is due on the whole amount, not just the excess, at flat rates with no personal allowance or personal savings allowance, which the Low Incomes Tax Reform Group's guide to tax after a death gives as 20% on savings income for 2026/27, and because UK banks pay savings interest without deducting tax, the estate has to account for it. Many estates can settle this informally by writing to HMRC at the end of the administration. HMRC's manual on the conditions for informal payment limits this to estates valued at less than £2.5 million at death, where the total income tax and capital gains tax due is less than £10,000 and assets sold in any one tax year came to less than £500,000. Other estates must register with HMRC by 5 October after the tax year concerned and file a Trust and Estate Tax Return.

One practical point catches people out. Some banks report interest on an executor account to HMRC under the executor's own details, even though the money belongs to the estate, so keep the statements and a note of the account's purpose in case HMRC queries your personal tax. If the estate's income is passed to beneficiaries, you may also need to give each of them form R185, which MoneyHelper describes as telling them how much income was earned and the tax paid on it.

What if you cannot or would rather not open one?

The most common alternative is to let a solicitor or other regulated probate practitioner hold the money in their client account, which is what usually happens when you instruct them to administer the whole estate. Solicitors must pay client money promptly into a client account under the SRA Accounts Rules and must account for a fair sum of interest on it, so the estate still earns interest, although you pay for the wider service. Our guide to doing probate yourself or using a solicitor sets out where that cost is worth it.

Paying estate money into your own personal account is the option to avoid. It mixes the estate's money with yours, makes the estate accounts much harder to prove and may create a personal tax query on the interest. If no bank will open an executor account for you, a new personal account that you use for nothing but the estate, with every transaction recorded and the statements kept, is a fallback, but it is a weaker position than a proper executor account and worth explaining to the beneficiaries in writing at the start.

How long can money stay in an executor account?

For as long as the administration lasts, because GOV.UK describes the executor as responsible for the assets from the date of death until everything has been passed on to the beneficiaries. Section 44 of the Administration of Estates Act 1925 also says a personal representative is not bound to distribute before a year has passed from the death, which is often called the executor's year, although simple estates are frequently wound up sooner and complex ones take longer.

You close the account once the debts and taxes are paid, the final estate accounts have been prepared and approved, and the last distribution has gone out. Close it too early and you have nowhere to receive a late refund or a forgotten account, which is why many executors keep a small balance until HMRC has confirmed the tax position. If money turns up after closure, our guide to finding accounts after probate explains what to do.

What to do next

1. Agree with any co-executors where the estate's money will be held and who can authorise payments.

2. Ask the person's bank whether it will pay the funeral invoice and any inheritance tax directly whilst you wait for the grant.

3. Ring the bereavement team of the bank you have chosen, check what they need, and open the account once you have the grant.

4. Close the person's accounts and have each balance paid into the executor account, recording every receipt and payment as it happens.

5. Keep a reserve for tax and late debts, then distribute, prepare the final accounts and close the executor account.

The executor account only fills up as each provider is told about the death and closes its account, so the work of notifying banks, insurers, utilities and subscription services sits at the centre of it. Legacy Trail's free notification service contacts those providers on your behalf, and if you suspect there are accounts the family does not know about, our Account Discovery Service searches for them before you finalise the estate accounts.