Legal News | 1.10.20
Digital assets after death
Many people have put thought into who they would like to inherit their home, investments or jewellery when they die, but have you ever taken the time to consider what you want to happen to your digital assets after your death?
What is a digital asset?
The term digital assets can include assets of financial value such as cryptocurrencies, domain names and Paypal credit, but also includes assets of no financial value but rather sentimental value such as photos, email accounts, and social media accounts.
It is worth noting some online services are not digital assets, but are instead classed as a licence that ends on death, and so cannot be passed on. This includes digital books and music streaming services.
How can I deal with my digital assets on death?
How you can deal with each individual digital asset will depend on the terms and conditions of the company that holds the asset, but broadly speaking:
- Digital assets of financial value can be left in your Will as you would any other asset. In the case of cryptocurrencies, these normally require a password or private key to access. There are rules about sharing these details but you also need to ensure your executors can access the information so the asset is not lost after your death.
- Digital assets which do not have financial value should not be included in your Will. Instead, consider leaving instructions in a Letter of Wishes to your executors, so they know what you would like to happen to them. This could include asking for your social media accounts to be memorialised, or closed. Beware that in some cases a user can nominate another individual to access their account after their death and this nomination may need to be made during your lifetime.
Are digital assets included in my estate for tax purposes?
If your digital assets have financial value then they will be included in your estate for Inheritance Tax purposes. The estate may also be liable for Income Tax and Capital Gains Tax during its administration.
Practical points to consider
It is best to begin by making a list of all the digital assets that you hold so you can decide what you would like to happen to them.
Some online platforms state in their terms and conditions that the digital assets cannot be passed on upon death. In these circumstances, you may want to prepare for this by putting together a folder, either on a memory stick or an online sharing platform, of your favourite photos, videos, and any other cherished items and sharing these now with a family member or friend so they are not lost.
For more information, or if you would like to create a new Will or to review your current Will to reflect your digital assets, please contact us on 01380 733300 or firstname.lastname@example.org.