How to Manage Your Digital Assets During Probate
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What Are Digital Assets?
A digital asset is any electronically created and stored item that is identifiable, accessible, and holds or generates value. As technology becomes increasingly embedded in both personal and professional life, digital assets have grown in popularity and significance.
The rise of new assets such as cryptocurrencies, social media accounts, digital art, and online businesses poses a new challenge for Estate Planning and Probate in the UK.
The Challenges in Estate Planning or Probate
Digital assets are consistently increasing in value, yet they do not come with any clear systems for management and administration after an individual’s death. This lack of clarity results in complex legal and administrative problems. Most people do not recognise that digital assets are at risk of being inaccessible or mishandled owing to improper documentation during the Probate process.
The most prominent issue when adding digital assets to a Will or Letter of Wishes is that the asset needs to be retrievable. Without clear guidance, Executors can have difficulty trying to gain access to online accounts and cryptocurrency wallets.
Digital assets are regarded as property under UK law, but the shift in ownership becomes complicated when crucial access information like passwords and PINs are not shared. Additional complexity is added to Probate since several platforms like Google and Facebook have specific terms of service regarding account inheritance.
To deal with this problem, people must capture their digital properties in their Will and/or Letter of Wishes, detailed enough to include account access directions. An Executor familiar with the intricacies of the digital assets must be appointed for the smooth management of these assets.
Recent Legal Developments
Legislative changes, such as the May 2024, Digital Markets, Competition, and Consumer Act, seek to improve how these assets are managed. Still, a full approach to the Probate system concerning the digital asset inheritance has yet to be accomplished.
Because of this progress, legal practitioners from the United Kingdom have started issuing guidance to clients with a recommendation to treat their digital assets with the same level of concern as their physical belongings.
This has a bearing on Wills and Letters of Wishes because they have to provide for assets other than tangible ones. Failure to take into consideration the value that people build up in their digital assets results to lengthy and complex Probate.
As such, it becomes increasingly inadvisable to ignore your digital assets, and it is imperative to review and update your Will.
How we Can Help
At Rix & Kay, our dedicated team of legal experts specialise in drafting Wills, managing financial affairs and are ready to assist you with any questions or concerns regarding digital assets.
Reach out to Danielle McGurk one of our experienced solicitors in Rix & Kay’s Private Client team via email or call us on 01825 761555 today.
