When Someone Dies, Their Bank Account Freezes — Here's How Your Family Can Still Pay for the Funeral

What’s happening

This is a change that sounds technical but lands on people at the hardest possible moment. Below we explain the problem it fixes, the rule as it stands today, exactly what’s being proposed, and — most importantly — what it means for you and the executor of your estate.

The problem: frozen accounts at the worst time

The moment a bank is notified of a customer’s death, it secures that person’s sole-name accounts. Online access is switched off and most payments out are stopped, to protect the estate. That’s sensible — but it creates an immediate squeeze:

• The funeral has to be arranged and paid for, often within days.
• Applying for probate (the court’s confirmation that the Will is valid and the executor can act) has its own filing fee, which in larger estates runs into the thousands.
• Meanwhile, the money to pay for both is sitting in a frozen account the family can’t touch.

Joint accounts usually keep working for the surviving account holder, and super or life insurance are dealt with separately. But for money held in the deceased person’s sole name, families can be left paying funeral costs on a credit card while they wait — sometimes months — for probate.

For the bigger picture on grants and timing, see our guide to probate in Australia.

The section 69B rule today: up to $15,000 without probate

There’s a long-standing safety valve for exactly this situation. Under section 69B of the Banking Act 1959 (Cth), when a bank customer dies the bank may pay out up to $15,000 from their account without being shown probate, letters of administration, or even the Will. That money can go toward:

• the deceased person’s funeral expenses or debts;
• a payment to the executor named in the Will; or
• a payment to anyone else the bank considers entitled, having regard to the law and normal estate-administration practice.

A few important points about how this works in practice:

• It’s discretionary — the law says the bank may release the money, not that it must. Each bank has its own process and evidence requirements.
• You’ll typically need a certified copy of the death certificate, the funeral invoice or receipt, and proof of your identity. Banks usually pay the funeral provider directly, or reimburse whoever paid.
• Banks also have processes for paying funeral expenses and court filing fees before a grant is issued. For example, NAB’s permissible-expense process covers these costs up to $15,000, subject to its evidence requirements and available funds.

The $15,000 section 69B limit is not an overall ceiling on releases without a grant. Banks have separate estate-release policies that may allow larger amounts. For example, CommBank generally requires probate or letters of administration when the balance of solely held accounts with it exceeds $100,000, or when it specifically asks for a grant. NAB separately requires a grant when accounts in credit with it total $100,000 or more, or in other specified circumstances, including a pending or existing grant, competing claims or a dispute, or suspected fraud or financial abuse. These policies do not guarantee release below a threshold; ask the bank what documents and authority it needs for the estate.

The catch? That $15,000 figure hasn’t changed since the provision was introduced in 1998. With today’s funeral costs and probate filing fees, it often doesn’t stretch far enough.

What’s being proposed (October 2026)

On 23 October 2026, the Treasurer and Assistant Treasurer opened consultation on a package of financial-sector changes. Most of it is bank-industry housekeeping — but one measure matters directly to families and executors (Treasury media release, 23 October 2026):

Increase the withdrawal limit for deceased persons’ estate-related expenses from $15,000 to $30,000, including funeral expenses, and expressly provide for the payment of court filing fees from an account.

In plain terms, the proposal would:

• Double the section 69B limit for payments without probate — from $15,000 to $30,000.
• Spell out court filing fees (the cost of applying for a grant of probate or letters of administration) as a purpose the money can be used for — removing any doubt.

The change reflects a recommendation the Law Council of Australia had pushed for, on the basis that $15,000 — frozen since 1998 — no longer covers a typical funeral plus filing fees.

Two practical details worth knowing from the consultation material:

• If it commences, the higher limit would apply to payments made after the change starts, regardless of when the person died.
• Any amount already paid under the existing $15,000 rule would count toward the new $30,000 total.

What it means for you and your executor

Whether or not the increase has commenced when it’s needed, the takeaways are the same:

• The funeral and the probate filing fee can usually be paid from the account — ask the bank’s bereavement or deceased-estates team early, and have the death certificate and the relevant invoice ready.
• Ask about the bank’s separate estate-release policy. A payment under section 69B is discretionary, and its cap does not mean every larger release must wait for probate. Whether a grant is needed depends on the bank’s policy and the estate’s circumstances.
• Keep some funds accessible. Because sole-name accounts freeze but joint accounts generally don’t, many couples keep a shared account so day-to-day money stays available. (That’s a personal finance choice, not advice — weigh it up for your situation.)
• Make the executor’s job findable. The bank will ask for ID and paperwork; your executor also needs to be able to find your Will. See where to safely store your Will.

Having a valid Will that names an executor (and a backup) helps make your wishes and chosen representative clear. Without a Will, a court appointment is not always required for a bank release: NAB may accept next-of-kin instructions in some cases where account balances are low and no executor or administrator is appointed, with evidence of identity and relationship. Letters of administration may still be needed, depending on the bank’s requirements and the estate’s circumstances. See what happens if you die without a Will in Australia, and our guide to choosing the right executor.

The bottom line

The $15,000 rule in section 69B has quietly helped families pay for funerals before probate for decades — but it had fallen behind the cost of living. Doubling it to $30,000 and expressly covering court filing fees is a small, sensible change that eases real pressure at a difficult time. It isn’t law yet, but it’s a reminder of how much smoother estate administration is when there’s a clear, valid Will and a willing executor ready to act.

Related Resources

• Probate in Australia — what it is, when you need it, and how long it takes
• How to Choose the Right Executor for Your Will
• What Happens If My Executor Dies Before Me? — why backups matter
• Where Is the Safest Place to Store Your Will?
• What Happens If I Die Without a Will in Australia?

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