Does debt die with you in Scotland?
When someone dies owing money, their debts are paid from what they leave behind. Family members do not usually have to pay from their own pocket, but there are exceptions worth knowing about.
Debt does not simply disappear when someone dies in Scotland, but it does not pass to their family either. It is paid out of their estate: the money, property and belongings they leave. Relatives do not usually have to pay from their own money, unless they were jointly responsible for a debt or signed as a guarantor.
Scotland is different. The person who deals with an estate is the executor, and their legal authority comes from confirmation, granted by the sheriff court. Confirmation is the Scottish equivalent of probate in England and Wales, and the process and forms are different.
Who pays the debts of someone who has died?
The estate does. Before anyone can inherit, the executor must use the estate to pay the person’s debts, taxes, funeral costs and the costs of dealing with the estate. The estate can include:
- cash and money in bank or building society accounts
- a house or other property
- shares and investments
- some insurance payouts
- belongings such as a car or jewellery
Debts paid from the estate can include credit cards, loans, hire purchase, council tax, energy bills, rent and mortgage.
A few points often come up:
- Joint bank accounts. If a married couple or civil partners both paid into a joint account, half the balance is presumed to belong to the person who died. Their debts can be paid from that share.
- Funeral costs have a special priority and come before most other debts. If you got a Funeral Support Payment from Social Security Scotland, it may be recovered from the estate. Social Security Scotland says you should not repay it from your own money.
- Council tax arrears. Citizens Advice Scotland says the council can write off the council tax arrears of someone who has died, but it does not have to.
When are family members responsible?
You are not automatically liable for the debts of someone who has died, even if you were their husband, wife or civil partner, or lived with them. mygov.scot says you will not need to pay a partner’s debt with your own money unless it was also in your name.
You can be responsible if:
- it was a joint debt, such as a joint loan, joint mortgage or joint credit agreement. You are liable for the full amount, not just half
- the bill was in both names, such as council tax or an energy bill for the home you shared. People who live together are usually jointly liable for council tax
- you were a guarantor, in which case the creditor can ask you to pay
- you are the executor and do not follow the process, for example by sharing out the estate too early
If you were only an additional cardholder on someone’s credit card and did not sign the agreement, you are not responsible for that debt (Citizens Advice Scotland: check if you have to pay a debt).
Do not pay a relative’s debt from your own money just because a creditor asks. Check first whether you are actually liable. If a creditor keeps pressing you, get advice from Citizens Advice Scotland or a free debt adviser.
For how joint debts work while people are alive, see partners, family and joint debts.
What does an executor have to do?
An executor is usually named in the will. If there is no will, or no executor, the sheriff court can appoint one, called an executor-dative, who is normally the surviving spouse or civil partner. The executor must:
- make a list (an inventory) of everything the person owned
- pay any inheritance tax due
- apply for confirmation
- collect in the estate
- pay the debts, then share out what is left
To find the debts, the executor should check gas, electricity and phone accounts, and any credit, hire purchase or rental agreements, and should normally advertise for creditors. Scottish Government guidance says the executor must wait six months from the death before sharing out the estate, to give creditors time to claim. An executor who pays out sooner can be personally liable for debts that turn up later. It is also sensible to search the free public Register of Insolvencies and the DAS Register to see if the person was in a formal debt solution.
The guidance also warns executors not to be rushed into handing back goods: hire purchase goods cannot be repossessed without a court order once a third of the price has been paid.
How does confirmation work?
Confirmation is a legal document from the sheriff court that lets the executor collect money and property from banks and others, and deal with the estate. You usually need it before you can take over bank accounts held in the person’s sole name.
- Small estate (£36,000 or less): the sheriff clerk can help you prepare the inventory. Contact your local sheriff court for an appointment.
- Large estate (over £36,000): court staff cannot help with the application, and legal advice is recommended.
When you work out the value, you do not deduct debts such as the mortgage, funeral costs or bills. Fees depend on the value of the estate. If there is no will, extra steps may be needed, such as a bond of caution (a kind of insurance). The executor’s reasonable expenses, including a solicitor’s fees, come from the estate.
If a bereavement has left you struggling with debts of your own, tell us a little about your situation and a licensed insolvency practitioner firm will call you to go through every option, including ones that are not a trust deed.
May not be suitable in all circumstances. Fees apply. Your credit rating may be affected. Free, impartial advice is available from MoneyHelper and other services.
What if the estate cannot pay all the debts?
If the debts are bigger than the estate, the estate is insolvent. The executor should get legal advice before paying anyone, because creditors must be paid in a set legal order.
An insolvent estate can be sequestrated (the Scottish legal word for bankruptcy), which means a trustee takes over and shares out what there is. The executor, or someone entitled to be executor, can apply, and so can a creditor (Bankruptcy (Scotland) Act 2016, section 5). In a sequestrated estate, the law sets this order (section 129):
| Order | What is paid |
|---|---|
| 1 | The trustee’s costs and fees |
| 2 | Deathbed and funeral expenses, and the reasonable costs of dealing with the estate |
| 3 | Reasonable expenses of a creditor who applied for the sequestration |
| 4 | Preferred debts, a small group of debts the law gives priority to |
| 5 | Ordinary debts, such as credit cards, loans and most bills |
| 6 | Interest on those debts from the date of sequestration |
| 7 | Postponed debts, such as a loan from the person’s spouse or civil partner |
Debts at the same level share what is available in proportion. A secured lender, such as a mortgage lender, keeps its rights over the property its loan is secured on. Relatives do not have to make up any shortfall unless they were jointly liable for a debt or a guarantor.
What happens to a trust deed or DAS when someone dies?
Protected trust deed. The Accountant in Bankruptcy (AiB) says that if someone dies during a protected trust deed, the trust deed carries on. Their estate pays their debts and the costs of running the trust deed before anything goes to the family. The executor should contact the trustee as soon as possible.
Debt Arrangement Scheme (DAS). The DAS Administrator must revoke (cancel) a debt payment programme when the person dies. AiB’s guidance says creditors cannot take enforcement action, or add back interest, fees and charges, until six weeks after the revocation.
Joint DAS programme. If one partner dies, the revocation has no effect for six weeks, so no interest can be added and creditors cannot act against the surviving partner. This gives them time to get money advice. If they apply for their own programme within 21 days, creditors cannot add interest, fees or charges until it is decided.
If you inherit while in a trust deed yourself, anything you inherit within 4 years of the date the trust deed was granted goes to your trustee. See windfalls and inheritance in a trust deed.
Losing someone is hard enough without money worries. If the stress is getting on top of you, debt and your mental health has practical steps and support. For your own debts, free debt advice is available, and Cruse Scotland offers bereavement support.
Official sources
- gov.scot: What to do after a death in Scotland, debts
- Scottish Courts and Tribunals Service: guide to dealing with a deceased’s estate in Scotland
- Citizens Advice Scotland: dealing with the affairs of someone who has died
- Accountant in Bankruptcy: Protected Trust Deed information document
- Accountant in Bankruptcy: revocation of a debt payment programme (DAS money adviser notes for guidance)
Common questions
Do I have to pay my husband's or wife's debts after they die in Scotland?
Not automatically. Being married, in a civil partnership or living together does not make you liable. You only pay from your own money if a debt was in your name too, such as a joint loan or a council tax or energy bill in both names. Their debts are paid from their estate, which can include their share of a joint bank account, so it may reduce what you inherit.
How long do creditors have to claim from an estate in Scotland?
The Scottish Government's guidance says an executor must allow six months from the death for creditors to make claims before sharing out the estate. An executor who pays out earlier can be personally liable for debts that turn up later. Executors normally advertise for creditors, for example with a notice in The Gazette.
What is confirmation in Scotland?
Confirmation is the Scottish equivalent of probate. It is a document from the sheriff court that gives the executor legal authority to collect the money and property of the person who died, pay their debts and share out what is left. For a small estate, worth £36,000 or less, the sheriff clerk can help you prepare the application.
What happens if the estate is not enough to pay the debts?
The estate is insolvent. The executor should get legal advice before paying anyone, because creditors must be paid in a legal order of priority. The estate can be sequestrated, which means a trustee takes over and shares out what there is. Relatives do not have to make up the shortfall unless they were jointly liable for a debt or a guarantor.
Related guides
- Partners, family and joint debts No joint trust deeds, joint debts, your partner's income and what happens to your family.
- Windfalls and inheritance in a trust deed Inheritance, lottery wins, compensation, bonuses and redundancy pay during a trust deed.
- Free debt advice in Scotland Free, impartial debt advice services in Scotland, with phone numbers and opening hours.
- Debt and your mental health Telling creditors, the Debt and Mental Health Evidence Form, getting breathing room, and support.