How Long Can a Creditor Claim Against an Estate?

There is no single date after which an inheritance is safe to spend. How long a creditor has to claim against an estate depends on what kind of debt it is, and death does not restart the clock or shorten it. Most ordinary debts run on the Limitation Act 1980's six-year period, counted from the point the debt became actionable, not from the funeral. Debts under a deed, and the capital owed on a mortgage, run for twelve.

What families really want to know, though, is a different question with a different answer: how long should an executor wait before handing money to the beneficiaries. That is not a legal deadline at all. It is a matter of protecting the executor, and the accepted route is to advertise for creditors under section 27 of the Trustee Act 1925 and then wait at least two months from the notice. Many executors wait longer, because a separate six-month window for family provision claims runs from the grant.

The uncomfortable part sits underneath both of those. If a valid debt turns up after the money has gone out, a creditor can usually follow it into the beneficiaries' hands and ask for it back. An inheritance that has already been spent on a car or a kitchen is not out of reach simply because it has been spent.

Why death does not start a new clock

People assume that dying resets the position with creditors, either wiping the debts out or starting a fresh countdown from the date of death. Neither happens. A debt is a chose in action that survives its debtor. It carries on with the same start date, the same terms and the same limitation period; the only change is that the creditor now pursues the estate rather than a person.

Under the Limitation Act 1980, an action founded on simple contract — a credit card, a personal loan, an overdraft, an unpaid invoice — must ordinarily be brought within six years of the date the cause of action accrued. For a credit agreement that is usually the date of default rather than the date the account was opened, which is why an old card that stopped being paid two years ago has four years left to run, not none.

Debts made by deed, which includes many guarantees and some formal loan documents, run for twelve years. So does the principal owed under a mortgage, though interest on it falls back to six. Sums owed to HMRC and certain other public debts sit outside the ordinary rules altogether, and a tax liability is not something to assume has quietly expired.

Two traps flow from this. First, part payment or a written acknowledgement of a debt restarts the six-year clock from that date, and an executor who pays something on account of an old, doubtful debt may have revived it. Second, in England and Wales a statute-barred debt is not extinguished; it becomes unenforceable through the courts. A creditor may still write, and may still ask, and can still lawfully accept payment if the estate offers it.

The executor's own exposure

The reason any of this matters is that a personal representative who distributes an estate and then meets a creditor is in trouble personally, not merely inconvenienced. Having paid the money out, they can be required to make good the debt from their own resources up to the value they distributed.

That is a harsh rule for someone doing an unpaid favour for their family, and the law provides a way out of it. Section 27 of the Trustee Act 1925 lets an executor advertise for claims. The notice goes in The Gazette, the official public record, and in a newspaper circulating in the district where any land in the estate lies, and it gives creditors a period of not less than two months to come forward. Once that period has expired, the executor may distribute having regard only to the claims they know about, and is protected against those they do not.

What the notice does not do is extinguish anybody's debt. The creditor's right against the beneficiaries survives; it is only the executor who is shielded. That distinction is the single most misunderstood thing in this whole area, and it is why executors who have done everything correctly still tell beneficiaries not to spend the money yet.

The six months that runs from the grant

Creditors are not the only people who can appear late. Under the family provision legislation in England and Wales, certain people — a spouse or civil partner, a former spouse who has not remarried, a cohabitant of at least two years, a child, and anyone the deceased was maintaining — may apply to the court for reasonable financial provision from the estate. The application must generally be made within six months of the date of the grant of representation, though the court has a discretion to allow a late claim.

An executor who distributes before that six months is up is not personally liable for a claim brought afterwards, but the beneficiaries can still be ordered to give the money back, which achieves the same misery by a different route. The mechanics of that deadline, and who realistically has standing to use it, are set out in the six months from the grant to bring an Inheritance Act claim. Where a marriage has ended but the financial order was never finalised, the position is different again and often surprising; we cover it in whether an ex-wife can claim against your estate.

Put the two timetables together and you get the working rule most solicitors use. Advertise early. Wait two months from the notice, and six months from the grant, whichever ends later. Only then start writing cheques.

The debts that are not the estate's to pay

Before counting the months, it is worth checking that a demand belongs to the estate at all, because a good deal of what lands on the doormat does not.

• Jointly held borrowing. A joint loan does not halve on death; the survivor was always liable for the whole of it, as we explain in what a surviving co-borrower owes on a joint loan. It is a debt of the living borrower, not a claim on the estate.
• Money held in joint names. Funds in a joint account usually pass to the survivor outside the estate, and the account is not normally frozen — the mechanics are in whether the bank freezes a joint account when one holder dies.
• Whose money it was to begin with. That can be contested, particularly where an adult child was added to a parent's account for convenience — see whose money is in a joint account with a parent.
• Debt in the family's name. A relative is not liable for a debt simply by being a relative. No creditor is entitled to press an adult child for a parent's credit card.

Ruling these out early can turn an alarming pile of correspondence into a much shorter list, and it changes how long the estate genuinely needs to be held open.

How long the grant itself takes

All of this presumes the estate is moving, and the honest position is that estates in England and Wales frequently take longer to reach a grant than families expect. The application cannot normally be submitted until the inheritance tax position has been dealt with, and the probate service then has its own queue. Delay at that stage does not pause anything: creditors' limitation periods keep running, interest keeps accruing on what is owed, and utilities and insurance on an empty property keep falling due.

HM Courts and Tribunals Service publishes management information on probate every month, showing how long applications are taking from submission to grant. It is the only authoritative source for the current position, and the figures move, so it is worth looking at the live publication rather than relying on what a friend was told last year.

Source: HM Courts and Tribunals Service, Family court and probate management information, published monthly on GOV.UK under the Open Government Licence v3.0. You can find the current tables through GOV.UK.

The practical consequence for a beneficiary is simply this. The date the grant arrives is not the date the money is safe. It is the date one of the two clocks starts.

When a beneficiary can be asked to give it back

If a valid debt emerges after distribution, the creditor's remedy runs against the people who received the money. Equity allows an unpaid creditor to follow assets into the hands of beneficiaries and recover up to what each of them received. It does not matter that the beneficiary acted in good faith, and it does not matter that they had no idea a debt existed.

Spending it does not solve the problem either. The claim is for the value received, so a beneficiary who has bought a car with the money may simply have converted the inheritance into a car and kept the liability. In genuinely hard cases a court can take account of a beneficiary's change of position, but that is a defence to argue, not a shield to rely on.

This is why sensible executors give beneficiaries an interim payment rather than the whole entitlement, and hold a reserve back until the waiting periods have run. It disappoints people. It is far better than the alternative conversation. Where the estate turns out to owe more than it holds, the reserve is not enough and the question becomes a formal one — the route through an insolvency administration order, which is bankruptcy after death exists for exactly that situation, and it puts an independent trustee between the family and the creditors.

Where an arrangement was already running

One case defeats the usual timetable completely. If the deceased was in a formal debt arrangement, the ordinary limitation analysis is beside the point, because the arrangement itself usually collapses and the original balances come back into play at once. That is the position described in what happens to an IVA when the person in it dies, and the revived debts, including interest that had been frozen, are then claims against the estate like any other.

The same is true where a lender has been quietly writing off nothing and a debt was sold on. A purchased debt is still the same debt with the same start date, and buying it does not give the new owner longer to sue than the original creditor had.

If you are reading this from the other side — as the person whose estate will one day be counted — the way to shorten all of it is to make sure there is money outside the queue. A life policy written in trust pays to the trustees rather than into the estate, which means it can reach a family in weeks instead of waiting for a grant, and it is not available to the deceased's creditors. Whether cover is offered, and at what terms, depends on age, health and underwriting. If that is the gap you have spotted, you can get life insurance quotes through an FCA-authorised broker and see what a level term policy written in trust would involve.

Scotland and Northern Ireland

Scotland does not use the Limitation Act at all. Debts there are governed by prescription under the Prescription and Limitation (Scotland) Act 1973, and prescription extinguishes the obligation rather than merely barring the remedy — a genuinely different outcome. Most ordinary obligations are cut off by the short negative prescription of five years, with a twenty-year long negative prescription behind it. The section 27 advertisement procedure does not apply either; Scottish practice is for an executor to wait six months from the date of death before distributing, because creditors who claim within that period rank equally with one another. Nor does the Inheritance Act apply in Scotland: the equivalent protection for a spouse and children comes from legal rights, which we explain in how legal rights let children claim against a Scottish estate.

Northern Ireland follows a pattern closer to England and Wales, with its own separate statutes rather than the same ones. It has its own limitation legislation, its own trustee legislation containing an equivalent creditor advertisement procedure, and its own family provision order under which claims must be brought within a fixed period of the grant. The principles map across; the section numbers and the courts do not. Anyone administering an estate in Belfast should take the Northern Irish version rather than assume the English one applies.

For the rest of this subject, including which debts die with the borrower and which do not, see our guide to debt, credit and finance after a death. Free help is available from Citizens Advice and MoneyHelper, and neither charges anything.

Frequently asked questions

How long does a creditor have to claim against someone's estate?

Death does not restart the clock. Under the Limitation Act 1980 most ordinary debts must be pursued within six years of the date the debt became actionable, with twelve years for debts under a deed and for mortgage principal. Executors protect themselves separately, by advertising for creditors rather than by relying on those periods. Scotland runs on prescription instead, with different periods.

How long should an executor wait before paying the beneficiaries?

Common practice is to advertise for creditors under section 27 of the Trustee Act 1925 in The Gazette and a local newspaper, then wait at least two months from the notice before distributing. Many executors also wait until the six-month window for Inheritance Act claims has passed, counted from the grant, and hold a reserve back for a while after that.

Can a beneficiary be asked to give money back?

Yes. If a valid debt appears after distribution, a creditor can generally trace the money into the beneficiaries' hands and ask for it back, whether or not they knew about the debt. That is why executors are cautious about paying out early, and why spending an inheritance the week it arrives can be a mistake.