CryptoTax UK · Guide
Crypto and Inheritance Tax in the UK
Many crypto investors overlook Inheritance Tax entirely — but HMRC is clear: cryptocurrency is part of your estate just like property or shares. If you die holding Bitcoin or any other crypto asset, its value on the date of death must be included in your estate. Educational only — not tax advice.
Calculate the crypto tax position →Crypto is a chargeable asset for IHT
HMRC's Cryptoassets Manual confirms that cryptoassets must be included on form IHT400 as part of the deceased's estate. The value used is the market value in GBP on the date of death. If the total estate exceeds the nil-rate band (currently £325,000, or up to £500,000 with the residence nil-rate band), Inheritance Tax is charged at 40% on the excess.
Valuing crypto for IHT purposes
The executor or personal representative must determine the market value of all cryptoassets held on the date of death. For widely-traded assets like Bitcoin and Ethereum, this is typically the mid-market price on a recognised exchange at the date of death. For illiquid or obscure tokens, HMRC expects a reasonable valuation — document your methodology carefully.
The access problem: what if no one knows the wallet?
Unlike a bank account, crypto held in a private wallet requires access to private keys or seed phrases. If these are not documented and left to your estate, the crypto may be permanently inaccessible — yet HMRC still values it as part of your estate. Secure documentation of access credentials is essential estate planning for any crypto holder.
CGT and IHT: the death interaction
On death, a capital gains tax-free uplift applies — meaning the beneficiary inherits the crypto at its market value on the date of death, wiping out any accrued gains for CGT purposes. IHT is charged on the same value. This means IHT and CGT do not stack on death, but the executor must still account for both taxes correctly in the estate administration.
Estate planning considerations
Gifting crypto to a spouse or civil partner during your lifetime is exempt from both CGT and IHT. Gifting to others during your lifetime may be a potentially exempt transfer — if you survive seven years after the gift, it falls outside your estate. Charitable donations of crypto are also IHT-exempt. Speak to a qualified estate planning professional for personal advice.
Frequently asked questions
Does the executor pay CGT when selling crypto from the estate?
Yes. If the executor sells crypto assets during estate administration, CGT may be due on any gain above the date-of-death value. The estate has its own CGT annual allowance. The gain is measured from the date-of-death value, not the original purchase price.
What if crypto has fallen in value since the date of death?
If crypto is sold for less than its date-of-death value during estate administration, the estate can claim a loss. This loss can be offset against gains elsewhere in the estate but cannot be carried back to reduce IHT.
How do I tell HMRC about crypto in an estate?
Crypto must be declared on form IHT400 (and supplementary pages) when reporting the estate to HMRC. You may also need to complete a tax return for the estate if income or gains arise during administration. If you are acting as an executor, consider seeking specialist advice.
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Calculate the crypto tax position →Educational guidance only. CryptoTax UK is not a regulated tax adviser and the information above does not constitute tax, legal or financial advice. Always confirm your specific position with HMRC or a qualified accountant before filing.