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Crypto inheritance in the UK: what happens to your crypto when you die

There is no bank to call and no password reset. If you hold your own crypto, whether your family ever gets it depends on what you leave them. Here is how to plan it, and what executors should do.

Written by
Simon Geils
Published
Last checked
Reading time
10 min

Checked by a person. Simon Geils last went through every claim on this page on 5 Nov 2026. Spotted something out of date? Tell us and it will be corrected.

This guide has two halves: one for people who hold crypto, one for the executors who deal with it afterwards. Read the half you need.

  • How crypto passes on when you die
  • If you hold crypto: plan so your family can recover it
  • If you're an executor: what to do, step by step
  • If someone has lost capacity: attorneys
  • Scotland and Northern Ireland
  • Checklists

How crypto passes on when you die

Crypto is property, and part of your estate. The Property (Digital Assets etc) Act 2025 confirmed this in England, Wales and Northern Ireland from 2 December 2025, and HMRC treats crypto as an estate asset in the same way as bank accounts and shares. It passes to whoever your will names, or under the intestacy rules if there is no will.

Name it in your will. A general gift of "personal possessions" may not cover crypto, because those gifts are usually read as physical things. Tell your solicitor or will writer that you hold crypto so the will deals with it expressly.

Where it's held decides how it's recovered. This is the part most plans miss.

01Exchange accountAn account with a company

Exchange account

The exchange holds the keys, so your executor deals with the company, much like a bank. Most exchanges have a process for bereaved families and ask for a death certificate, the grant of probate and ID. Your family's only job is to know the account exists.

02Hardware walletA device you keep yourself

Hardware wallet

A hardware wallet is the physical device that keeps your keys offline. The device itself can be replaced; what matters is the recovery phrase (also called a seed phrase), the 12 or 24 words written down when it was set up. Whoever has those words has the crypto. Without them, nobody, including the maker, can get it back.

03Wallet appSoftware on a phone or computer

Wallet app

Crypto in a wallet app on a phone or computer works the same way: it has its own recovery phrase. If the phone is locked and the phrase is lost, the crypto is usually lost too.

04Passphrase or multisigMore than one piece needed

Passphrase or multisig

A passphrase is an extra word added to the recovery phrase; without it, the phrase opens a different, empty wallet. A multisig setup needs several keys, with a set number required to move funds. Both make theft harder, and both mean your family needs more than one piece, and a clear map of where each one is.

If you hold crypto: plan so your family can recover it

The aim is a plan that sits between two risks: too hidden, and your family never finds it; too obvious, and someone else finds it first, while you're still alive.

  1. List what you hold, and where. Exchange accounts, devices, wallet apps, and any passphrase or multisig. You don't need amounts, and the list must never contain a recovery phrase, PIN or password.
  2. Tell your solicitor or will writer. Ask them to deal with crypto expressly in your will, and say who should inherit it.
  3. Write a letter of instructions for your executors. In plain English: what exists, where the device and backup are kept, how to recognise them, what not to do, and who to ask for help. Keep it with your will or where your executors will look first.
  4. Keep the recovery phrase safe, and findable. Store it as you would a key to everything you own, somewhere your executor can reach with authority: a home safe, a safe deposit box, or sealed instructions with your solicitor. See seed phrase storage: where should I keep mine?
  5. Map any extra pieces. If you use a passphrase or multisig, your letter must say how many pieces there are and where each one is kept, without writing the pieces themselves into it.
  6. Test that it would work. Check your backup restores the right wallet, without exposing it. See how to test your recovery phrase backup safely
  7. Review it once a year, and whenever you add an account, a device or a passphrase.

If you're an executor: what to do, step by step

  1. Secure everything. Gather any devices, notebooks, papers and the person's phone and computer, and keep them together somewhere safe. Note where each item was found.
  2. Find out what exists. Check the will, any letter of wishes or instructions, papers and notebooks, emails from exchanges, bank statements showing payments to exchanges, apps on their phone, and past tax records.
  3. Claim exchange accounts through the exchange. Contact each exchange's process for deceased customers. Coinbase and Kraken, for example, ask for the death certificate, the grant of probate or letters of administration, the executor's photo ID and a signed letter with instructions. Don't sign in as the person who died.
  4. Establish what self-held crypto is worth, without moving it. Crypto sits on a public record, the blockchain. If you can find the wallet's public addresses, which are safe to share, the balances on the date of death can be read without anyone touching the recovery phrase. A specialist can help with this step.
  5. Include it in the inheritance tax return at its date-of-death value. HMRC asks for the date of death value of crypto on the IHT400. If you believe crypto exists but can't access it, HMRC's guidance is to explain this and give its believed value in the additional information box. Since January 2026, HMRC has been writing to agents to remind them that crypto must be included. Your solicitor or tax adviser handles the return.
  6. Recover self-held crypto only once you have authority. Wait for the grant of probate or letters of administration. Then restore the wallet on a new device bought direct from the maker, entering the words on the device itself, and send a small test transaction before anything else moves. See how to move crypto from an exchange to a hardware wallet for the same checks in reverse.
  7. Distribute it, and keep a written record. Send to wallets the beneficiaries control, checking each address on the device's screen, or sell through an exchange in the estate's name. Record what was found, what was moved, when and where: you'll need it for the estate accounts.

Tax after the death. For capital gains tax, the estate is treated as acquiring crypto at its market value on the date of death, and passing it to a beneficiary doesn't create a gain for the estate. A rise in value while the estate holds it can be taxable, so ask a tax adviser before selling.

If the recovery phrase can't be found, read I've lost my recovery phrase. What now? before paying anyone: it explains what can still be recovered, and what can't.

If someone has lost capacity: attorneys

The same safety rules apply when someone can no longer manage their own affairs. An attorney acting under a registered lasting power of attorney for property and financial affairs can deal with the person's crypto in their best interests. To prove their authority to an exchange, an attorney can share an online access code (13 characters, starting with V, valid for 50 days) or show the original registered LPA or a certified copy. Self-held crypto needs the same care as above: secure first, don't experiment, and move it only with a clear plan.

Scotland and Northern Ireland

  • Northern Ireland: the Property (Digital Assets etc) Act 2025 applies, as in England and Wales. Powers of attorney there are enduring powers rather than lasting powers.
  • Scotland: the 2025 Act doesn't extend to Scotland, which passed its own Digital Assets (Scotland) Act in April 2026. Executors apply for confirmation rather than probate, and attorneys act under a continuing power of attorney.
  • Everywhere: the technical side is the same. Local law covers who inherits; the steps on this page cover how the crypto is found and recovered safely.

Checklists

If you hold crypto:

  • My solicitor knows I hold crypto, and my will deals with it expressly
  • I have a list of every account, device and wallet app, with no secrets in it
  • My executors have a letter of instructions and know where to find it
  • My recovery phrase is stored safely, on paper or metal, never digitally
  • Any passphrase or multisig pieces are mapped
  • I've tested that my backup restores the right wallet
  • I review all of this once a year

If you're an executor:

  • Devices and papers are secured, untouched and together
  • I've checked the will, papers, emails, bank statements and apps for crypto
  • Each exchange has been contacted through its process for deceased customers
  • Self-held balances have been established without moving anything
  • The date-of-death value is in the inheritance tax return
  • Nothing is recovered or moved before the grant of probate
  • Everything found and moved is recorded in writing

Getting help

KeyCompass helps holders prepare: testing that a setup could be recovered and writing plain-English instructions for their family, alongside their solicitor. It also guides executors and attorneys through finding and recovering crypto safely, on their own devices.

KeyCompass never asks for your recovery phrase, a photo of it or any part of it, and never contacts you first about your crypto. Anyone who does, whatever they claim to be, is attempting to steal from you.

Crypto inheritance planning and executor support

Sources

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