Dormant Assets Scheme Explained
When money in a bank or building society is unclaimed for 15 years, the organisation can transfer the assets to the Dormant Assets Scheme (the Scheme). We look at what the Dormant Assets Scheme is and the need to identify all your assets in your estate.
A dormant asset is a financial product, such as a bank account, which has not been used for many years. They are classed as Dormant Assets when the provider has been unable to reunite with its owner.
The Scheme is a government and financial industry initiative. It allows unclaimed funds to be used for social and environmental purposes, when the owner cannot be contacted.
The Scheme has recently expanded to include some investment funds where the fund manager has been unable to get in touch with the owner. Funds cannot be transferred to the Scheme until the bank, building society or other finance holder has made extensive efforts to trace the rightful owner.
Where this is not possible, the Scheme transfers funds to the Reclaim Fund Limited (RFL). This is a treasury-backed company that deals with the administration of the unclaimed money. RFL is responsible for distributing money to social or environmental causes. If the owner comes forward and proves they have title to the money, RFL is required to make a relevant payment to them.
Estate planning
When dealing with your estate or that of a loved one, it is essential to identify all assets. When making your own Will, you are advised to put together a list of all of your holdings. Ensure that banks, building societies and other fund holders have up to date contact details for you. If your account has become inactive, take steps to notify the fund holder that you still wish to keep your money with them.
Estate administration
When dealing with the estate of a loved one, try and ascertain where all of their funds were held. This can be tricky if they did not leave a comprehensive list. You must go through their paperwork, correspondence and digital records. If you believe that they may have held an account with a particular organisation, contact them in your role as estate executor or administrator. Ask them to check their records and let you know if they have any holdings.
When to update records
It is particularly important to check that all asset holders have up-to-date details for you in the event of any significant life changes. For example, moving house or a divorce, and also if the bank or building society undergoes a merger. Review and update your Will and list of assets regularly. It is recommended to review at least every five years or more frequently if your situation changes. For instance, if you marry or divorce, have a child or grandchild, or someone in your existing Will dies.
If you would like to review your will or discuss your estate planning please call us FREE on 0800 781 6658 or email us at enquiries@estplan.co.uk
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