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What if there isn't enough money to pay the person's debts?

When someone dies, their debts don't die with them. They have to be paid out of the person's estate.

If you are administering an estate, you must make sure you have paid all the debts before you pay the beneficiaries. If you are not sure what the debts are, you need to advertise in the London Gazette and a local paper for anyone who may have a claim on the estate, and then wait two months before paying the beneficiaries. The London Gazette is a weekly government publication that contains various legal notices (see ‘Further help’ for its phone number).

You could become liable (responsible) for the debts if you pay the beneficiaries without having cleared all the debts first. You may also have to submit a tax return for the person who has died.

If there is not enough money to pay all the debts, they must be paid in a particular order:

1. the funeral expenses and 'testamentary' expenses (those to do with dealing with the will);

2. any debt secured by a mortgage on a property;

3. HM Revenue and Customs;

4. the Department of Work and Pensions, who deal with social security (you may have to refund any over-payment of benefits);

5. unpaid pension contributions or wages.

If all the debts can be paid, but there isn’t enough money left to pay everything set out in the will, the legacies (those where a specific amount is mentioned) will be paid first, and the other people mentioned will get what is left over.

If there is not enough to pay all the legacies, the people entitled to the legacies will get a proportion of what they have been left, depending on how much money is available. The other people mentioned in the will, who are supposed to get the remainder, will get nothing.

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