What Happens to Your Digital Assets When You Die Without a Will

In today’s digital age, our online presence extends far beyond social media. From cryptocurrency investments to cloud storage filled with precious family photos, digital assets have become significant parts of our lives and estates. Yet many Australians haven’t considered what happens to these assets after they’re gone. Consulting with wills and estate lawyers in Melbourne is increasingly necessary as our digital footprints grow. This article explores what happens to your digital assets when you die without a will in Australia, the challenges your family might face, and practical steps you can take now.

Key Takeaways

• Without a will, accessing digital assets can be extremely difficult for families due to service provider policies and privacy laws
• Digital assets include everything from social media accounts and emails to cryptocurrency and online businesses
• Creating a digital inventory and appointing someone to manage these assets is critical to prevent loss
• Australian intestacy laws may not adequately address digital property ownership
• Service providers have varying policies for handling accounts after death

What Counts as Digital Assets

Definitions and Examples

Digital assets encompass far more than most people realise. They include your social media profiles on platforms like Facebook and Instagram, email accounts containing personal and business correspondence, cloud storage services like Dropbox or Google Drive, and digital photos and documents stored across devices.

Financial digital assets can be particularly valuable, including cryptocurrency holdings, blockchain-based NFTs, online banking accounts, payment platforms like PayPal, digital wallets, and even accumulated loyalty points from retailers or airlines.

For those with online businesses, digital assets extend to websites, domain names, intellectual property, and digital products or services that generate income.

Distinction Between Account Access and Ownership

There’s a critical difference between accessing an account and actually owning its contents. Most online service agreements differentiate between the account data itself and any transferable ownership rights.

Licences for digital purchases (music, movies, e-books) often terminate upon death according to terms of service, making them non-transferable despite being paid for. This creates a complex situation where family members might not legally be able to inherit certain digital content.

How Australian Law Treats Digital Assets Without a Will

Intestacy Basics Across Australian States

When someone dies without a will (intestate) in Australia, state-specific intestacy rules determine who inherits their estate. Generally, assets pass to a spouse and children according to a formula, then to parents and siblings if there’s no immediate family.

A family member must apply to become the administrator of the estate, a process that varies slightly between states and territories but typically requires submitting various forms and evidence to the Supreme Court.

Are Digital Assets Classed as Property?

Australian law is still evolving regarding digital assets. While physical property clearly passes according to intestacy rules, digital assets create complications because they exist at the intersection of property law, contract law, and intellectual property rights.

The legal reality is that service provider contracts often override traditional property concepts. For example, your Facebook account isn’t technically “owned” by you but is subject to Facebook’s terms of service, which may not align with intestacy laws.

“Digital asset inheritance is a growing concern for estate planning. We’re seeing more families struggling to access accounts and digital property after a loved one passes away without clear instructions.” – Pearsons Lawyers

Role of an Administrator and Legal Process

Applying for Letters of Administration

To handle someone’s estate without a will, a family member must apply for Letters of Administration from the Supreme Court. This requires submitting the death certificate, identification, proof of relationship to the deceased, and an inventory of known assets.

The process typically takes several months and incurs court fees ranging from $700 to $2,000 depending on the state and estate value.

Administrator Powers and Limitations

Even with Letters of Administration, administrators face significant hurdles with digital assets. Many service providers will require additional documentation beyond basic probate paperwork, and some may refuse access regardless of legal authority.

Administrators may need to seek specific court directions to deal with service providers that refuse to cooperate, adding time and expense to the process.

Service Provider Policies After Death

Major Platform Approaches

Digital platforms have varying policies for handling accounts after death:

• Facebook offers memorialisation or deletion options and allows users to appoint a legacy contact while alive
• Google’s Inactive Account Manager lets users determine what happens to their account after a period of inactivity
• Apple requires a court order plus the death certificate to access a deceased person’s account
• Microsoft generally requires a court order specifically mentioning the accounts

Cryptocurrency and Digital Wallets

Cryptocurrency presents unique challenges. Exchanges like Coinbase and Binance typically require a death certificate, will or probate documentation, and sometimes court orders specifically addressing the digital assets.

For non-custodial wallets where the deceased controlled their private keys, if these keys aren’t documented somewhere accessible to the family, the cryptocurrency may be permanently inaccessible—potentially resulting in significant financial loss.

Practical Steps for Families When There’s No Will

Immediate Actions After Death

Family members should quickly secure all devices belonging to the deceased, including phones, computers, and tablets. Before powering down any devices, check for logged-in accounts and document them. Look for password managers or any written account information.

Preserve evidence of ownership by taking screenshots of logged-in accounts and gathering any receipts or emails that prove purchases or account ownership.

Contacting Providers

Each service provider has specific requirements for deceased user accounts. Start by locating their “deceased user” policy online and prepare the required documentation, typically including:

• Death certificate (certified copy)
• Proof of relationship to the deceased
• Letters of Administration or equivalent
• Government-issued ID for the person making the request

Steps to Take Now

Create a Will and Digital Asset Plan

The most effective solution is creating a proper will that specifically addresses digital assets. This should name an executor with explicit authority to access and manage online accounts.

Maintain a Digital Inventory

Create and regularly update a secure inventory of your digital life, including:

• Account names and types (but not passwords in the will itself)
• Recovery email addresses and phone numbers
• Hardware locations (computers, external drives, cold wallets)
• Instructions for what should happen to each account

Consider using a password manager with emergency access features that allow a designated person to gain access after a predetermined waiting period.

Use Available Legacy Tools

Take advantage of legacy planning tools offered by major platforms:

• Set up Facebook’s Legacy Contact
• Configure Google’s Inactive Account Manager
• Add trusted contacts to Apple’s Recovery Contact system
• Document cryptocurrency recovery seeds and store them securely

Conclusion

Dying without a will creates significant complications for accessing and transferring digital assets in Australia. From social media accounts to cryptocurrency, these assets can be effectively lost without proper planning. The legal process of obtaining Letters of Administration is just the beginning—families face an uphill battle with service providers, privacy laws, and technical barriers.

Don’t leave your digital legacy to chance. Create a comprehensive will, maintain a digital asset inventory, and consider consulting Pearsons Lawyers who can provide guidance tailored to your specific digital asset situation. Taking action now will save your loved ones considerable stress, time, and potential financial loss in the future.