Finding out what assets a person had used to be a fairly simple task. The process involved looking at bank statements, pension policies and share certificates. Nowadays there are factors such as online income and accounts with no ‘paper trail’. So what happens to these so-called ‘digital assets’?
| How do you find out what online assets the deceased person has?
This can be tricky. A starting point would be to look at the deceased person’s bank accounts and statements. It is wise to get historic statements for at least a year.
Current account statements are useful. They show transfers to or from other accounts, pension payments, share dividends and insurance policy premiums. You can then contact the relevant companies to ask for details of any assets or accounts. There are companies that can check for unclaimed assets – however these won’t cover everything.
| How can you make life easier for whoever has to deal with your estate?
I would recommend keeping an up to date list of your assets/ accounts and passwords so that whoever is dealing with your estate can access the list. Make sure you keep this information secure especially your passwords.
| Make a will with a specialist solicitor
A safe and sensible place to keep information about your estate is with your will. If your solicitor is storing your will you can rely on their duty of client confidentiality. When you are alive, nobody else has the right to access your will but you. When you die, the executors in your will deal with your estate.
| What if I earn money online?
More and more people are now earning online income. One example of this is YouTube advertising. In the case of YouTube content, the videos are the actual assets. However, the real value of the videos is likely to be in the accumulated ‘following’ and the advertising revenue associated with it.
After a person dies, their YouTube account is closed. The beneficiaries can upload the videos themselves but at this stage the original following and advertising revenue will have been lost. Loss of revenue can be avoided by making the videos the property of a company so they can be continued after the person’s death.
| Things to consider
Online assets and income streams are creating new challenges for people dealing with estates. This inevitably creates even more potential pitfalls. If you’re dealing with an estate and you get it wrong, you could find yourself being personally liable to beneficiaries or creditors. Getting professional advice will reduce risks considerably. You’re entitled to do so and the costs should come from the estate.
It is important that people talk to their solicitor about making a will and planning for their own estate so that they can ensure their estate is dealt with correctly and that their assets pass to their intended beneficiaries.
| Proposed reform
To take into account the changing landscape, the Law Commission opened a consultation last year. Their consultation paper recommends reforms that will recognise the change in individuals’ assets and provide protection for these digital assets. For example, and possibly the biggest example, Bitcoin has become more common and provides the same primary characteristics as other property rights or objects.
These reforms would mean that your digital assets such as crypto currencies, databases and software will be included in the definition of ‘property’. This allows your digital assets to be protected in your will and not left vulnerable.
Due to the nature of digital assets and them not being tangible property, this makes it hard for them to ‘fit into’ the traditional categories of property. Therefore, this reform has considered this, as well as the different property rights that digital assets attract.
The reform will allow the law to remain flexible and dynamic, to adapt with the changing needs of society.