What happens to old banknotes?

From 1 July, £20 notes featuring the composer Sir Edward Elgar will no longer be valid currency. Until 30 June, you can take these notes to banks or building societies to be exchanged for legal tender – new £20 notes featuring economist Adam Smith. But what will happen to the old notes?

830 million bank notes worth around £11.4bn are destroyed in the UK every year. Notes are usually destroyed because they are of poor quality, or because they are no longer legal tender.

They are pulped, compressed into bricks and sent to an official government incinerator where they are burned alongside any illegal tobacco that has been seized by HM Revenue & Customs.

Typically, £5 notes have the shortest life expectancy – they are usually removed from circulation due to damage after just one year. But £50 notes can survive for over five years.

But if you have some old currency, don’t worry – it isn’t worthless. “Genuine Bank of England notes that have been withdrawn from circulation retain their face value for all time,” says the Bank of England website.

In practice, this means that you can take any old Bank of England note to the Bank in Threadneedle Street, London and staff there will exchange it for the equivalent value in legal currency. Last year, 3,526 people did just that. You can also post your notes – but obviously, you do that at your own risk.

So whether it’s a £20 note featuring Elgar or a £1 note from 1694, you can exchange it – although the latter might be worth more at the auction houses.