NS&I index-linked certificates can be passed on as part of an estate after the owner's death, a Which? money expert has confirmed. These certificates will remain index-linked and tax-free for beneficiaries.
The certificates offer a tax-free return currently set at 0.01% above the consumer price index (CPI). Although they are no longer available for purchase, their returns slightly above inflation make them an attractive product.
Upon death, the certificates become part of the estate and continue to accrue index-linked interest, remaining free of income tax. Personal representatives have the option to cash them in or transfer them to beneficiaries.
In contrast, NS&I Premium Bonds cannot be passed on. Instead, they must be cashed out by the executor or held for an additional 12 months.