Digital assets in Estate Planning

30 June 2025 in Wills and Estates Law | 8 min read | skip to FAQs

This article will set out important considerations when accounting for digital assets in estate planning. We outline what testators (the will maker) and executors (the person who administers the estate and carries out the instructions) should be aware of in this area.

In an increasingly digital world, it is becoming much more common for people to transact, interact and generally live much more of their lives online. Consequently, it is imperative that when people embark upon estate planning that they are aware of the need to account for their digital assets.

What are Digital Assets?

Section 46 of the Probate and Administration Act 1898 (NSW) defines the assets of the testator to include real assets and any “personal estate” which includes less tangible assets such as legal rights, including the right to make a legal claim or a debt owed to the testator. While traditionally assets for the purposes of estate planning includes property that a person owns, such as real estate, shares, and cash in bank accounts, digital assets can constitute a wider range of items. Anything that the person controls or has a licence to use online (or on the world wide web) may be considered a digital asset, and therefore would be worth considering when planning your estate.

Notable categories of digital assets include:

1. Cryptocurrencies;
2. Intellectual Property accessed or stored online;
3. Email Accounts, including the content of any emails;
4. Social Media Accounts including any intellectual property such as videos, photographs, and text;
5.  Subscriptions – Entertainment and Loyalty Programs;
6. Blogs and websites including any intellectual property; and
7. Online content, such as eBooks.

This is not an exhaustive list, and depending on the circumstances other types of digital assets may be relevant to any person’s estate planning.

Common Issues with Digital Assets in Estate Planning

The Importance of Ownership of Digital Assets in Estate Planning

Before bestowing a digital asset in your will upon a beneficiary, it is essential to determine whether or not the asset can actually be transferred. Certain assets, such as content in online media libraries (such as iTunes) are licensed, not owned. This lack of ownership would prevent a testator from being able to transfer these particular assets to a beneficiary in a will. Therefore, before including any assets in a will, it is imperative that the relevant Terms of Service Agreement for a particular asset is considered.

Ownership of the copyright in any music will depend on who published the music. In the event that the testator published (wrote) the music, or any other material the subject of copyright, such as a story or novel published online, the author will own the copyright in that material.

Issues of Jurisdiction 

Another issues, inherent with the borderless nature of the digital world, is that of jurisdiction. Digital assets are often hosted on platforms based outside the user’s country of residence, and thus would be subject to the laws of the host country. Differences in legal recognition of digital assets and privacy laws across various jurisdictions are among the key challenges to navigate on this front.

The recovery of any digital assets stored overseas is likely to involve additional complications similar to the recovery of more traditional assets such as real estate located overseas. This may involve enforcing an Australian judgment overseas and requires examination of the law in that jurisdiction to ensure that Australian judgments can be enforced in that jurisdiction.

Problems with Accessing Digital Assets in Estate Planning

Accessing digital assets is another issue to contend with. To enable any executor to properly deal with digital assets, access to those assets, whether in  the form of passwords, keys or any other login credentials, is vital. For a testator, striking the appropriate balance between ensuring executors have access to all necessary information needed for logins and protecting one’s privacy when still alive is crucial. Providing passwords and other details in a document, separate to the will, may assist with this.

Such access details will also be important where the testator simply wishes to have certain digital assets, such as social media, closed.

Valuation of the Digital Assets

Valuation is another hurdle often present with digital assets. While physical assets tend to stay consistent in value, or at least follow consistent patterns concerning long term appreciation or depreciation, digital assets are more likely to experience volatility that complicates valuation. Financial assets such as cryptocurrencies operate in relatively small markets and with lower levels of liquidity, which can heighten volatility. Meanwhile, for other kinds of digital assets such as intellectual property, it can be difficult to assign any value to them at all.

Incorporating Digital Assets into a Will

In light of the challenges described, it is essential that any testator undertakes the necessary measures to include digital assets into a will. Undertaking the following measures during the testator’s life will make administering the digital aspects of the testator’s estate considerably easier after death.

Taking Inventory

Given how much of many people’s lives are now presented digitally, it can be difficult to remember the full extent of such digital assets. Taking inventory of digital assets prior to writing a will allows a prospective testator to make sure that everything is ultimately accounted for. Once a comprehensive list has been prepared, the corresponding login information for each asset should be noted to facilitate access for the executor after the testator passes away. It is important to note that a will becomes public after the granting of probate, so the login information should not be included in the will itself.

Leaving Specific Instructions

Different assets will warrant different approaches. When writing a will, a testator should tailor the instructions for each asset to properly reflect the nature of each asset. For example, an email account should be dealt with differently to an account for an online trading platform. Any instructions should consider the policies set by the providers of those digital assets.

Cryptocurrency

Cryptocurrencies, such as Bitcoin, are digital forms of currency that many people now use for investing and accumulating wealth. Consequently, they have become increasingly relevant to estate planning as more testators are likely to have assets tied to cryptocurrencies. It is essential that full details are provided for any cryptocurrency accounts including any login, key and access details to enable the executor to retrieve any cryptocurrency and convert the cryptocurrency to cash. Again, these login and key details should not be provided in the will but in a separate document.

Access to Cryptocurrency in Estate Planning

Access to cryptocurrency is exacerbated by the decentralised and unregulated nature of cryptocurrencies. Unlike traditional currencies which are regulated by legislation (such as the Currency Act 1965 (Cth)) and controlled by institutions, such as the Reserve Bank of Australia, cryptocurrencies are stored electronically through Blockchain technology, and can only be accessed through unique private keys. Keeping these keys secure for executors is crucial, as the executor cannot gain access to the cryptocurrency without the key.

There are multiple ways to store keys

1. Hardware Wallets – which includes physical devices (such as USBs) that store cryptocurrencies offline. The executor needs to know the location of the device and how to unlock it.
2. Paper Wallets– which entail printing the access information on paper and storing it securely. The executor needs to know the location of the paper wallet and how to use the access information.
3. Online Wallets/Exchange Accounts – which are accessible online and can include login information, multi-factor authentication and any other relevant security information. Information regarding these accounts should be stored securely and separately, with only the executor being able to access them.

Tax Implications

Prospective testators and beneficiaries should be aware of the tax implications attached to the inheritance of cryptocurrencies. While Australia does not have an Inheritance Tax, there are some inherited assets that still impose certain tax obligations on beneficiaries, and one such category of these assets are cryptocurrencies.

As cryptocurrency transactions in Australia are subject to capital gains tax (CGT), beneficiaries who inherit cryptocurrencies may incur CGT when disposing of their inheritance, being liable for CGT on the gains made since the original purchase.

Therefore, before bestowing cryptocurrencies on a beneficiary, a testator should explain to them the tax obligations related to the prospective inheritance. Moreover, if the beneficiary consents to receiving their inheritance as cryptocurrency, the testator should make sure that accurate records are available for beneficiaries to be able to complete accurate tax returns that account for the cryptocurrency transactions and allow for the calculation of any capital gain.

Other Considerations

As described above, cryptocurrencies are among the digital assets vulnerable to volatility, which may make them a less desirable inheritance for certain beneficiaries. Moreover, while cryptocurrencies can be used to exchange goods and services in Australia, unlike in certain other jurisdictions, they are not considered as legal tender, which can impede its utility. It is very unlikely that cryptocurrency, unlike traditional currency, could be used by an executor to meet any of the estate’s financial obligations.

Valuing Intangible Digital Assets in Estate Planning

Our increasingly digital world means that having some sort of digital presence is necessary for most people. The resulting digital assets may not have an inherent monetary value, but that does not reduce the benefits they provide to users during their lives, and potentially even beyond it.

For example, Facebook allows for a designated “Legacy Contact” to look after a Facebook account on behalf of the deceased. This Legacy Contact can memorialise the account, ensuring the preservation of the deceased’s legacy and protecting it from hackers. Instagram also allows for the memorialisation of a deceased’s account. These features demonstrate and acknowledge the immense, often personal, value of social media accounts, despite their lack of monetary value. Many testators are concerned with how they are remembered after their deaths, and the proper direction for and management of digital assets following death can be crucial in maintaining the legacy of the deceased.

Even for digital assets not tied to the reputation or legacy of a testator, there is still value in accounting for them during estate planning. Depending on whether digital content is owned, rather than licensed, it may be possible to leave it to a beneficiary who would appreciate it. In a culture that attaches significant emotional value to the consumption and possession of art and media, these may be important assets for testators to bestow upon beneficiaries.

Responsibilities of Executors

Given that the inclusion of digital assets within estate planning is still in its infancy, the responsibilities of an executor are not fully set out and continue to change. Nevertheless, the following list can serve as a useful guide for prospective executors:

1. Obtain a complete list of any and all digital assets.
2. Obtain access details such as the login information for digital assets, and safeguard that login information from others.
3. Manage the online accounts for the deceased and engaging in the memorialisation process for applicable accounts as instructed by the testator.
4. If there are digital assets with a financial value, ensure that such digital assets are protected, retrieved, valued and realised.

How can BSM Sydney Lawyers assist you?

Navigating the estate planning process can be challenging for a variety of reasons. Our experienced and compassionate estate lawyers at BSM Sydney Lawyers will provide advice regarding the inclusion of digital assets in a will, as well as the associated responsibilities for testators, executors and beneficiaries. Our lawyers are there every step of the process, from drafting the will to ensuring that probate is granted. The estate lawyers at BSM Lawyer Sydney provide a free, 20-minute, no obligation consultation to discuss and assess your individual situation.

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BSM Lawyer Sydney has offices conveniently located in Sydney CBD, Sutherland, Parramatta, Shellharbour and Wollongong.