Custody and Estate
Crypto Inheritance Planning in Australia: Custody, Wills and Tax
Key points
- Crypto passes under your will like other assets, but only if someone can find and access it.
- The ATO generally disregards the capital gain when an asset passes to a beneficiary.
- Never put a seed phrase in a will: keep recovery details separate and secure.
- A one-page access plan, checked every year, does most of the work.
- Super and SMSF holdings follow their own rules, not just your will.
Why crypto needs its own inheritance plan
Shares and property sit on registers that your executor can find. Self-custody crypto does not. If you hold coins on a hardware wallet guide and you are the only person who knows where the device and recovery words are, your family may never be able to reach them. That is why custody and inheritance belong in the same plan.
The good news is that the fix is simple and mostly paperwork. You do not need to share your keys today. You need a clear, secure way for the right person to find them at the right time.
What happens to crypto when you die in Australia?
Your crypto forms part of your estate. It passes under your will, or under the laws of intestacy if you die without one. Moneysmart recommends that everyone over 18 has a will and keeps it up to date (Moneysmart: Wills and powers of attorney).
For tax, the ATO says a capital gain or capital loss is generally disregarded when an asset passes to your legal personal representative (your executor) or to a beneficiary. The beneficiary is treated as acquiring the asset on the day you died and generally takes on your cost base, so tax arises when they later sell, swap or spend it (ATO: How CGT applies to inherited assets). The ATO lists exceptions, including assets passing to a foreign resident or a tax-advantaged entity such as a super fund or charity, and sales made by the executor while winding up the estate are taxed under the normal rules (ATO: Deceased estates (CGT guide)).
| Situation | General tax outcome (ATO) | What to check |
|---|---|---|
| Crypto passes to a beneficiary under the will | Capital gain or loss disregarded on death | Beneficiary keeps records of your cost base |
| Beneficiary later sells or swaps it | Normal capital gains tax rules apply | Acquisition date and cost base records |
| Executor sells crypto to pay estate costs | Normal capital gains tax rules apply to the estate | Estate tax return |
| Crypto passes to a foreign resident or tax-advantaged entity | Exception: a CGT event can happen just before death | Speak to a registered tax agent |
The custody problem: access, not ownership
Most crypto lost after a death is not lost to tax or the courts. It is lost because nobody can get in. Three things decide whether your family can reach your crypto:
- Exchange accounts. An executor can usually contact a registered exchange with a death certificate and probate, but only if they know which exchanges you used.
- Self-custody wallets. Coins in your own wallet can only be moved with the recovery words or keys. Read what a seed phrase is if you are unsure what yours protects.
- Devices and passwords. Phones, password managers and two factor apps can lock out the people trying to help.
A five-step crypto inheritance plan
- List what you hold. Every exchange, wallet and network, with a rough value. No keys or passwords on this list.
- Write an access letter. Plain-English steps for your executor: where the hardware wallet is, where the recovery details are stored, and which exchanges to contact.
- Store recovery details separately. Keep seed phrases offline and secure, apart from the access letter, so neither document alone exposes your coins.
- Update your will. Ask your lawyer to name crypto as an asset and point to your instructions, without including keys.
- Review it every year. Add new wallets, remove old ones and test that the instructions still make sense.
In the 5-step SHIFT Method (Set your plan in writing, Hold Bitcoin as your core, Invest in on-chain businesses with real revenue, Filter every coin before you buy, Take profits on the way up), this sits in Step S: Set your plan in writing. Members record their custody setup and sell rules on a one-page Strategy Sheet, which makes the inheritance letter far easier to write. Our Profit Ladder exit strategy guide covers the sell side, and the Collective Shift Security Centre covers wallet security.
Teaching your family the plan
A plan only works if the people who need it can follow it. You do not need to turn your partner or children into crypto investors. You do need them to know three things: that the crypto exists, where the instructions are, and who to call for help. A short walk-through once a year, with nothing sensitive shown, removes most of the stress.
- Explain the difference between an exchange account and a wallet you control.
- Show where the access letter is stored, without opening the recovery details.
- Agree on who they would call first: your executor, lawyer or accountant.
- Warn them that genuine helpers never ask for a seed phrase. Anyone who does is attempting theft.
Super, SMSFs and crypto in your estate
Moneysmart notes that your will does not automatically cover your superannuation, so you need to nominate beneficiaries with your fund (Moneysmart: Wills and powers of attorney). If you hold crypto inside a self-managed super fund, the fund owns it, so the trust deed, any death benefit nominations and the fund’s own wallet instructions all matter. Our SMSF crypto guide explains how SMSF crypto works.
What Collective Shift is, and is not
Collective Shift is a Melbourne crypto education and research company founded in 2020 by TEDx speaker Ben Simpson. We never hold member crypto and never ask for seed phrases. This guide is general information, not legal, tax or financial advice. For your will and estate, work with a lawyer, and for tax, a registered tax agent. General guidance on crypto risk is at Moneysmart: Crypto assets.
Want a written crypto plan your family could follow?
Collective Shift has helped 1,000+ members build a written crypto plan with the 5-step SHIFT Method, live analyst sessions and the Live Crypto Portfolio. Founded in Melbourne in 2020 by TEDx speaker Ben Simpson, rated 4.8 out of 5 from 135+ Trustpilot reviews, and Platinum and Accelerator carry a 14-day money-back guarantee.
Quick questions
What happens to my crypto when I die in Australia?
Your crypto forms part of your estate and passes under your will, or under the intestacy laws if there is no will. The practical problem is access: if nobody can find your wallets and recovery details, the coins can be lost even though your will leaves them to someone.
Is there inheritance tax on crypto in Australia?
There is generally no tax when crypto passes to you. Under the ATO rules, a capital gain or loss is generally disregarded when an asset passes to the executor or a beneficiary. The beneficiary takes on the cost base, and capital gains tax applies when they later sell or swap the crypto. There are exceptions, such as foreign resident and tax-advantaged beneficiaries.
Should I put my seed phrase in my will?
No. A will can become a public document once it goes through probate, so it should not contain a seed phrase or passwords. A common approach is for the will to say that crypto exists and where the instructions are kept, with the recovery details stored separately and securely.
How can my family access my crypto in an emergency?
Write a short access plan: which exchanges and wallets you use, roughly what each holds, where the hardware wallet and recovery details are kept, and who to contact. Store it securely, tell your executor it exists, and check it every year.
Does my will cover crypto held in my SMSF or super?
Not automatically. Moneysmart notes that your will does not automatically cover your super. Crypto held in an SMSF sits with the fund, so the trust deed and any death benefit nominations matter, alongside the instructions for accessing the fund’s wallets.
Does Collective Shift help with estate planning?
Collective Shift provides general crypto education and research, not legal or financial advice. Members learn how to document their plan and secure their holdings, and we encourage them to work with a lawyer and an accountant on their will and estate.
Written by Ben Simpson, founder of Collective Shift and TEDx speaker, and reviewed by Matt Willemsen, Director of Research. As of November 2026.
Published 3 November 2026. Updated 3 November 2026.
General information only, not personal financial advice. Collective Shift provides research and education. Consider your own circumstances and speak with a licensed financial adviser before acting.
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