When a loved one dies, it understandably may not be at the top of your list of priorities. However, it is important that you deal with financial matters sooner rather than later. Here we discuss where to go for financial advice after a bereavement.
If you are not sure where to start or feel you need support with this, please read on. We have put together a guide to help ease your worries and any financial concerns you may have.
Getting Help with Funeral Costs
If you are seeking help with funeral costs, there are several options available. The government can offer support in paying for funerals in various ways. Whether it be through a one-off payment or the council.
You may be able to get a funeral expenses payment or funeral support payment which is available to people who claim benefits to help pay for a funeral.
If your husband, wife, or civil partner died before 7th April 2017 then you may be able to claim a tax-free bereavement support payment of at least £2500. Plus a further 18 payments of £100 or £350 which are paid monthly.
An interest-free loan called a budgeting loan is also available if you or your wife, husband, or civil partner have been receiving income-related benefits for at least 26 weeks. You can receive up to £812, depending on your ability to repay the loan, and whether you have any children or savings.
You may also be eligible for a public health funeral. If no other suitable arrangements can be made, for example, if no one is willing or able to arrange the funeral or there are no funds available, then the council may be responsible for recovering the costs of the funeral.
If you are arranging a funeral for a child, you may be entitled to the children’s funeral fund which can cover the cost of burial or cremation fees. This fund is claimed by the funeral directors and burial or cremation authorities on behalf of the family.
Claiming Bereavement Benefits
As well as financial support to help with funeral costs, you may be entitled to other benefits. You may have heard of Bereavement Allowance, Widow’s Pension, Bereavement Payment, or Widowed Parent’s Allowance, but these have all been replaced with Bereavement Support Payment.
Reviewing Your Insurance Policies
If your husband, wife, or civil partner has died, you will need to review and amend the insurance policies that they are named on.
You will need to check if you are still covered on your partner’s car insurance if you were a named driver on their policy. When the main policyholder dies, most policies terminate so it important that you contact the provider to find out whether you need to take out a new policy.
You will also need to contact the provider of your building and contents insurance to notify them that someone on the policy has passed away.
If you have a life insurance policy, whether it be individual or joint, get in touch with the provider. This is to amend the policy and find out what options are available.
Paying Tax
Before inheritance is distributed following someone’s death, any tax due must be paid by their estate. Inheritance Tax is the tax on someone’s assets after they pass away.
The estate may also be liable to Capital Gains Tax on things that they owned. This is a tax on the profits or gains they made on the sale or transferral of assets.
Some income is taxable above a particular threshold. They could have overpaid or underpaid Income Tax, which may result in them being owed a tax refund or owing tax to the government.
You should notify HM Revenue & Customs (HMRC) and the Department for Work and Pensions (DWP) when someone passes away. You can do so online using the Tell Us Once service.
If they were registered as self-employed, you may need to complete a self-assessment tax return. If you use the Tell Us Once service, HMRC will tell you if you need to do this.
Coping with Debt
If your wife, husband, or civil partner has passed away leaving you with debts to pay, there are several steps you can take and sources of support available.
Get in touch with the organisations to which you owe money to explain your situation and let them know how much you can afford to pay them.
If you are struggling to keep up with your mortgage repayments, you should contact your lender to let them know. They will explain what options are available to you. If you are renting, speak to your landlord to see whether they can temporarily reduce your rent.
You may be entitled to government support: Housing Benefit if you are renting, or Support for Mortgage Interest if you own your home.
There are also many independent debt advice agencies you can contact for free help should you feel you need it. If you are struggling with debt management and paying your bills, there is plenty of support available. This can help you with talking to lenders and creating a personalised debt plan.
Organisations you could contact for additional support or advice include Citizens Advice Bureau, National Debtline, StepChange, and Bereavement Advice.