A significant financial alert has been issued for millions of state pensioners across the UK who hold Premium Bonds from NS&I. With the Chancellor's first Autumn Statement imminent, failing to organise their affairs could lead to them missing out financially.
The Unclaimed Millions and Inheritance Risks
New data reveals a startling figure: an estimated 6.7 million pensioners are likely to have Premium Bonds, with more than £105 million in prizes remaining unclaimed as of September 2025. This often occurs due to incomplete records or because executors are unaware the bonds exist.
While Premium Bonds are free from income and capital gains tax, they form a crucial part of an individual's estate for inheritance tax purposes. It is therefore vital that your executor knows about them and understands how to contact NS&I. The positive news is that any winnings or bonuses retain their tax-free status, even after the holder's death.
Looming Tax Changes for Pensioners
The warning comes as Chancellor Rachel Reeves prepares to deliver her Autumn Statement on 26 November. This financial update is causing concern, with 40% of people worried about potential changes to pensions and inheritance tax. A further 23% of Brits are already planning to give away money to reduce a future inheritance bill.
Andrew Byres from SafeKeep highlights another pressing issue: “From April 2026, the full new state pension will rise by 4.8% to around £241 per week, or £12,530 a year.”
He adds, “With the income-tax personal allowance frozen at £12,570, many retirees could find themselves edging closer to or crossing the tax threshold, especially those with even modest private or workplace pensions.”
How to Protect Your Finances
To ensure your loved ones can claim what is rightfully theirs, it is essential to take proactive steps. Keep your bond details clearly recorded with your important financial documents and ensure your NS&I online account is accessible.
As the system is now largely digital, being confident with online access or getting help from a trusted family member can make claiming prizes and managing your estate far smoother.
Furthermore, with analysts estimating that an additional 2.7 million pensioners will fall into higher or additional-rate tax bands over the next two years, reviewing your income strategy is crucial.
Spreading pension withdrawals evenly across the year or staggering lump sums can help reduce your tax exposure and prevent you from being pulled into a higher tax bracket. As Andrew Byres concludes, “A quick review now could prevent an unexpected tax bill next spring.”
