Dormant bank accounts and reclaiming lost money

A dormant bank account is one that has gone unused for a long time, and the money in it is still yours. The legal test in the Dormant Bank and Building Society Accounts Act 2008 is 15 years with no transactions by or on the instructions of the account holder¹. Before that point, banks and building societies apply their own shorter inactivity rules, typically one year for current accounts and three years for savings accounts².

Even after an account is legally dormant and its balance has been transferred into the government's Dormant Assets Scheme, the right to reclaim the money never expires. Under the Act, dormant money can be reclaimed at any time by those entitled to the account³. The scheme exists to put forgotten balances to social and environmental use while the money is unclaimed, not to take ownership away from the person who earned it.

What makes a bank account dormant: 15 years without activity

The statutory definition is precise. An account is dormant for the purposes of the scheme if it has been open throughout the period of 15 years ending at that time, but during that period no transactions have been carried out by or on the instructions of the holder¹. The explanatory notes to the Act put it more plainly: a dormant account is an account on which there have been no customer initiated transactions for 15 years⁶.

There is an important exception written into the Act. An account is treated as not dormant if, at any time during the 15-year period, the holder instructed the bank or building society not to communicate about the account, or if withdrawals were prevented or penalised under the account's terms¹. So a fixed-term account whose terms blocked withdrawals does not quietly become dormant while the saver waits for maturity.

In everyday banking, the word "dormant" is used earlier and more loosely. Which? reports that accounts are typically classed as inactive after one year for current accounts and three years for savings accounts, with triggers including undelivered mail, no notification of a change of address, and no withdrawals or deposits for a set period². NatWest classes a bank account as inactive if it has not been used for five years, a rule that also covers Royal Bank of Scotland accounts⁷. These internal labels do not affect ownership of the money; they are the point at which the provider starts treating the account differently, writing to the customer and eventually restricting transactions.

The Financial Ombudsman Service has dealt with real cases. In one, a customer named Derek found his account had been classified as dormant because he had not used it for several years, and the bank said he would need to go into a branch to have his identity verified and the account reactivated⁸. Health problems had made that difficult for him, which is the kind of situation a complaint can address.

What happens to your money when an account goes dormant

Dormancy changes how an account is administered, not who owns the balance. Tesco Bank tells savings customers that once an account becomes dormant they can no longer transact on it and the bank stops sending communications by post, though statements remain viewable through online and mobile banking⁵. The customer still earns interest on the savings until the balance is dealt with⁵.

Providers are expected to warn customers before this happens. Tesco Bank writes to customers first to check they are still using the account, and writes again once the account has become dormant to confirm it⁵. To keep an instant access account active, it asks customers to transact at least once within a three-year period, and holders of fixed rate accounts are directed to their maturity options when the term ends⁵.

Dormancy is far more common than many people assume, and providers set their own triggers for it. Tesco Bank makes savings accounts dormant when they have not been used for 3 years⁷, Nomo may mark a current account dormant after 12 months of non-use, and Orchard Credit Union places accounts in a suspense account after 36 months with no transactions and no response to correspondence¹⁰. The usual triggers are no withdrawals or deposits for a set period, undelivered mail, or no notification of a change of address, so an account can go dormant simply because someone moved house and stopped using it.

The Dormant Assets Scheme and which banks and building societies take part

The Dormant Bank and Building Society Accounts Act 2008 set up the framework for a scheme under which money in dormant bank and building society accounts can be distributed for the benefit of the community, while ensuring the right of owners to reclaim their money is protected⁶. Banks and building societies that opt into the scheme can transfer the money held in dormant accounts to a central reclaim fund³. The fund's purposes are the management of money transferred from dormant accounts, the payment of claims by account holders whose balances were transferred, and the passing of surplus money to the Big Lottery Fund or another appointed distributor⁶.

The Dormant Assets Act 2022 expanded the scheme, describing itself as making provision for an expanded dormant assets scheme and conferring a power to further expand its scope¹¹. The expanded scheme supersedes the general scheme for dormant bank and building society accounts under Part 1 of the 2008 Act¹². Several sections of the 2008 Act were repealed on 6 June 2022 as part of that changeover¹.

Most large banks are signed up to the scheme, which means that after 15 years the money in dormant accounts is transferred for charitable and community use⁴. Building societies take part on the same basis, and the scheme continues to grow: the government's review of the 2008 Act examined how banks and building societies have transferred dormant account money to a central reclaim fund, how much has been transferred and how promptly³. A building society member gets one extra safeguard: where the balance of a dormant account held by a member is transferred under the scheme, their membership rights in the society are preserved until the customer is repaid⁶.

The scheme does not apply to everything. Transfers under the alternative scheme for smaller institutions and transfers of unwanted assets sit outside the main scheme's scope¹¹, and the Lifetime ISA exclusions are covered below.

Your right to reclaim: the money is never lost

The single most important rule in this area is that dormancy never extinguishes ownership. Under the Act, dormant money can be reclaimed at any time by those entitled to the account³. Age UK puts the same point directly: the money in an inactive account is still yours and you are entitled to claim it at any time¹³. Which? confirms that even after 15 years, when the balance may have been given to charitable causes under the Dormant Assets Scheme, you will still be able to reclaim your money if you track down the old account⁷.

The 2022 Act also created a route for people who do not want the money back. A person with a right to payment of a dormant-scheme amount may ask for it to be transferred to an authorised reclaim fund instead of being paid to them, on making a declaration that no third party has any right in or over the amount, and the right to payment is then extinguished or reduced¹². This is a choice, not something done to you.

One technical point protects ISA savers. Where a dormant account balance is paid back into an ISA following a repayment claim, that payment does not count towards the annual subscription limit¹⁴. Reclaiming a dormant ISA balance therefore does not use up that year's ISA allowance.

How to trace a lost or forgotten account

The free, single-route search is the My Lost Account service, run by the British Bankers' Association, the Building Societies Association and National Savings and Investments (NS&I)⁴. Its aim is for consumers to be able to trace a lost account, whether at a building society, bank or NS&I, via a single web portal¹⁵. NS&I confirms the service can be used to trace old accounts with other providers as well as NS&I¹⁶.

The service is free. Which? describes My Lost Account as a free service for finding forgotten and lost bank accounts¹⁷, and notes that getting started is straightforward and free¹⁸. A search can be carried out by using a free application online¹⁹. It is also possible to trace another person's lost account if you are legally empowered to do so, for example as an executor, attorney or deputy¹⁵.

Before the single service existed, tracing meant writing to each institution separately, and paid tracing services grew up in the gap. Which? has reported on the closure of Experian's tracing service and pointed readers to the free routes instead⁴. There is no reason to pay anyone to search for lost money when the industry's own service does it at no cost.

A few practical points improve the chances of a successful search:

• Gather whatever you can remember: the name of the bank, building society or NS&I, any old account documents, and addresses you lived at when the account was open.
• Note whether the account may have moved. Building society mergers and provider takeovers mean the original name may no longer exist; the search service covers successor firms.
• Search for childhood accounts too. Accounts opened for you as a child, and money held by the Court Funds Office, can also be claimed. The government explains how to get Court Funds Office money when you turn 18²⁰.
• If the account belonged to someone who has died, you will need to prove your identity and that you are entitled to the balance, for example through the provision of a will⁷.

How to reclaim money from a dormant account

Once a trace finds an account, the reclaim itself is a claim against the provider or, if the balance has been transferred, against the reclaim fund. Which? explains that after the 15-year transfer point you will still be able to reclaim your money by following the standard procedure². The claim is paid by the reclaim fund, whose stated purposes include the payment of claims by dormant account holders whose balances were transferred⁶.

Expect to prove who you are. The documents banks accept for identity are the same as those used when opening an account: usually two separate documents proving identity and address, such as a passport and a recent bill²¹. MoneyHelper lists the alternatives if you have no passport or driving licence, including recent documents typically under three months old such as a Council Tax bill, utility bill, bank or building society statement, credit card statement, HMRC letter or tax statement, mortgage statement, tenancy agreement, benefit or state pension statement, or a letter from an employer, college or training provider²². The Court Funds Office route asks for proof of identity, for example a passport, plus a bank statement or letter from your bank dated within the last three months²⁰.

If you are claiming for someone else, the bank will want proof of your name and address, evidence of your authority to act for the account holder, and proof of the account holder's name and address if not already held²³. The authority might be a power of attorney, a deputyship order or a grant of probate, depending on the circumstances.

A reclaim that is refused on a technicality is not always the end. In a parallel context, HMRC's rules for Help-to-Save allow an account holder whose bonus claim was rejected to reapply within 90 days of the expiry of the original period²⁴. The lesson is general: ask the firm exactly what evidence it needs and whether a fresh application is possible before giving up.

Accounts not covered, including Lifetime ISAs

The scheme's coverage has edges, and the Lifetime ISA is the clearest one. The 2022 Act excludes amounts held in a Lifetime ISA from transfer to an authorised reclaim fund where the transfer would result in liability to pay a withdrawal charge to HMRC¹¹. The same exclusion covers proceeds of a contract of long-term insurance held in a Lifetime ISA and client money held in a Lifetime ISA, on the same condition¹².

The Financial Conduct Authority's complaint-handling rules mirror this. From 2 August 2024, DISP 2.7 excludes from the dormant asset complaints route proceeds of a contract of insurance or client money held in a lifetime ISA where their transfer to a dormant asset fund operator resulted in, or would result in, liability to pay a lifetime ISA government withdrawal charge²⁵. In practice this means Lifetime ISA money that cannot be moved without triggering a charge stays outside the scheme rather than being transferred and penalised.

Lifetime ISA rules have their own withdrawal conditions. A full balance can be withdrawn without charge if the saver is terminally ill, with less than 12 months to live²⁶. A first-time residential purchase will not qualify as a withdrawal from a Lifetime ISA if the purchase is funded by a loan from a person who is connected to the account investor²⁷. These rules matter to a reclaim because the tax treatment of the money depends on how it comes out of the wrapper.

The volume of complaints in this area shows how often things go wrong. The Financial Ombudsman Service recorded 34 complaints opened about investment-only Lifetime ISAs in Q1 2026/27, alongside 620 about cash ISAs including cash lifetime ISAs and help to buy ISAs²⁸. In one published case, a consumer named Shelby complained about her bank's online Lifetime ISA opening process after a year passed and she realised she had not received her bonus²⁹. Complaints about deposits and savings accounts excluding cash ISAs numbered 1,294 in 2025/26³⁰.

Where to get help if a reclaim is refused or delayed

Start with the provider. Complain in writing, giving the dates of your trace and claim, the account details you supplied and the documents you sent, and ask what extra evidence it needs. The Financial Ombudsman Service can then look at the complaint if the firm's final response does not resolve it. Its complaint-handling rules cover dormant asset scheme operators, subject to the exclusions described above²⁵. Help with writing the complaint is on the writing a complaint page, and free consumer advice is available if the dispute stalls.

Delays sometimes have a different cause from refusal. The ombudsman handles complaints where a bank or building society has frozen an account or blocked a payment because of unusual or suspicious activity, or doubts about whether the customer authorised a transaction³¹. A dormant account being reactivated can look unusual to a bank's systems, so a freeze and a reclaim can collide. Where money has been sent to the wrong account, the bank is required to give clear and accurate information on the options available, which may include making a complaint or taking court action against the recipient³².

If the account belonged to someone who has died, different rules can apply around access. Their bank may temporarily stop access to their account after they die, but it might still release money for funeral costs³³. In Scotland, Funeral Support Payments are recovered from the estate if the person who died was aged 18 or over and had money or assets, and money in the deceased's bank account that was available for funeral costs counts towards that recovery³⁴.

Where a reclaim is being made for someone who lacks capacity, or by a family member acting informally, the bank will need proper authority before releasing money. The government's guidance for deputies and attorneys sets out what banks ask for²³, and the site's pages on third-party mandates and letters of authority explain the options for letting someone act for you.