Leaving a digital legacy
Going through and sorting out someone's stuff after they've died is a sad and difficult process: photographs, books, CDs or records, old DVDs and videos – it all takes time. And one of the decisions you have to make is what to do with all those things – do you throw them away, do you keep them yourself or do you give them to charity?
With luck, your loved one has left instructions in their will about how to dispose of the accumulated ephemera of their life, including clear guidance on who – if anyone – should inherit their collection of early prog rock vinyl or their treasured pile of The Beano.
But what if those images, words and sounds are digital rather than physical? If they are held on a computer or hard disk at home, then it's straightforward and just a case of making sure the deceased's heir gets the computer.
However, more and more of us store our stuff online and across various cloud services. Many people have thousands of photographs on Facebook or on Google + or Flickr or any one of the many online services that offer storage space in return for collecting your data and showing you targeted ads.
And it's not just digital assets such as music and images, either: we increasingly do our banking and other administrative tasks online, using services that require passwords.
As a result of this shift online, lawyers are now urging us to think about what happens to our digital assets after our death. The Law Society recently urged people to "leave clear instructions about what happens to their social media, computer games and other online accounts after their death".
That also applies to bank accounts and other financial services. Chris Thurlow, partner at solicitors Hart Brown, says: "Many banks and other organisations are encouraging their customers to move to a paper-free system of statements for bank accounts, credit cards and other investments.
"In the past, one of the key ways to establish whether a deceased person held accounts was to go through their paperwork and any post received after their death so they could work out which companies and institutions to contact. This is becoming far harder as less paperwork is produced."
So how do you access digital assets? Perhaps you know the deceased person's user name and password – but be careful, as it is usually against the terms and conditions of providers of services such as Facebook or Apple for anyone else to log in to someone else's account, even after the account-holder has died.
However, Facebook acknowledges that someone "could leave their username and password – that's up to them". What Facebook can do is 'memorialise' a user's page on receipt of a 'valid request' from a family member or a friend who has filled in the online form. The request has to be backed up by proof of death, which can be a link to an obituary published online.
'Memorialising’ a profile
Once a profile is memorialised, nobody can log in to it and the page can't be modified in any way although, depending on the original user's privacy settings, friends will be able to post memories on the wall. Facebook says it takes "the sanctity of the privacy of deceased people's accounts really seriously" – but it will help where it can, as one father found out when his son died.
To mark its 10th birthday, Facebook created 'lookback' videos for users, which pulled together content from photo and video albums to create a short clip. When John Berlin, whose son Jesse had died aged 21, started seeing those videos from friends, he wanted to be able to see Jesse's lookback video. He posted a video appeal to Facebook chief Mark Zuckerberg asking to be allowed to see the video even though he didn't have access to his son's page.
Facebook says: "In the end, we managed to do it using content that the child had shared in his public setting – as this would be visible to everyone."
Where the stuff you want to pass on to an heir is something you've paid for - such as music via Apple's iTunes store – you might be able to do that, though it depends on each provider. Under Apple's terms and conditions, "you agree that the iTunes products are provided to you by way of a licence only" – in other words, you have bought the right to use the song, album or film.
However, Apple adds: "In practice, if customer services are contacted about a deceased iTunes user, we will transfer ownership if the person sends us a copy of the death certificate of the account-holder and a legal document confirming you have the right to transfer the deceased's property."
Apple also concurs with Facebook about sharing user names and passwords, saying: "It would be far easier for the deceased to have shared their iTunes username and password, then family members could access the account and transfer the content on to another machine."
However, don't expect Apple – or indeed, any other provider – to give you the password of someone who's died. Londoner Josh Grant found that out the hard way after his mother died, when he wanted to access the iPad she had bequeathed to him in her will.
Grant told the BBC: "We've provided the death certificate, will and solicitor's letter but it wasn't enough. It's now asked for a court order to prove that Mum was the owner of the iPad and the iTunes account."
One point to bear in mind, however, is that a provider such as Apple might not be able legally to pass on some of the content in a deceased person's library. Apple says that while someone else logged in using a password bequeathed to them could transfer music, "other content – TV, film and apps – is protected by DRM [digital rights management] software to stop illegal sharing". It adds that this is "set by the rights owners", not by Apple.
No permission to pass on details
Facebook says it's a violation of its terms and conditions to log into another person's account, and it "would never pass on someone's password to a third party", even if there were a will granting permission for Facebook to give their password to an heir or executor.
If you do decide to leave details of your usernames and passwords for your heirs, how do you make sure that information is safe? One option is to write down the usernames, passwords and any PINs to your digital accounts and leave that list with a trusted person or an executor but, as Thurlow points out, that's a risky strategy.
"It is possible for information stored on a PC to be accessed by hackers, and it is also possible the information could fall into the wrong hands. It is therefore essential to ensure that the information is stored in a very safe and secure place." Thurlow suggests that such a list could be lodged with your solicitor, along with your will, or in a bank.
However, don't be tempted to include those usernames and passwords in your will: as Thurlow points out, your will is a public document. "Many people have begun to include this kind of information in their wills. However, after they have died and their will has been sent to the Probate Registry, the will becomes a public document. Therefore, any confidential information in the will can be obtained simply by applying to the Probate Registry for a copy of the will."
Saga Legal advises that you should consider making a directory of all the online services you use – without giving away passwords – and add it to your will, so your loved ones at least know which digital services you use. This should take the form of a Letter of Wishes and include the following: online banks, online shops, social media, email accounts, professional directories and general websites you have signed up to, however insignificant they may seem.
A number of services have also sprung up online offering to manage your digital assets – often for a fee. Such services usually offer to store documents securely online and allow you to nominate trustees to handle your digital stuff after you've shuffled off this mortal coil.
Afternote.com is one such service, offering a place to store details of your wishes for your funeral, a bucket list of things you want to do while you're still alive and a list of how you'd like your social media pages to be treated after your death, all shared with two or three nominated 'trustees' – who also need to have Afternote accounts.
There are a couple of things to be aware of with such services: the first is what happens to the information they store if the service goes out of business. If it happens after your death but before your trustees have managed to access your data, then your information is lost forever. Another issue to consider is how annoying it is for your trustees: tellmebye.com, for example, sends several emails – without telling you – to the people you nominate to look after your digital goods.
And don't forget tax planning for your death – and that includes digital assets. My Kindle library, for example, has more than 350 books in it, and at the youthful age of 50, I expect to buy many more books before my date with the Grim Reaper, which means that at my death, the value of my Kindle books alone could run into hundreds, if not thousands, of pounds.
Those assets are potentially liable to inheritance tax, says Thurlow. He adds, however: "The question is what the value of that asset is on the open market. Many licences attaching to electronic downloads do not allow for the downloads to be sold on to third parties and as such they would have no value for IHT purposes."
With so much of our lives being lived online, your heirs will thank you if you've taken steps to make the aftermath of your death less difficult and painful. As Shaun Parry-Jones, head of trust development at Hart Brown, says: "This is a very big area that we are only just beginning to get to grips with."
What to do with your digital assets
- ONLINE BANK ACCOUNTS – These should automatically shut down as a result of the normal bank account being closed. To be on the safe side, you can specify in a Letter of Wishes in your will that your online account should also be deactivated.
- EMAIL ACCOUNTS – Request to have these closed upon your passing unless they are shared with a spouse, in which case you may want to leave it to their discretion.
- SOCIAL MEDIA PAGES – These sometimes offer the option of closing down the account or turning it into a memorial page. Many of these services require a link to a website to serve as proof of death.
- PROFESSIONAL DIRECTORIES – We often forget that we register ourselves within professional directories, and you should request for these profiles to be deleted in your Online Directory.
- ONLINE SHOPS – It may not seem important to close these down immediately but these accounts often retain sensitive banking information as well as personal details. So be cautious and request for the accounts to be deactivated.
- REGULAR ONLINE PAYMENTS – Some online services require a monthly subscription that is taken out of your account by direct debit. While these would be frozen as soon as a death certificate is registered and provided to the bank, payments might still slip through. Shutting down these accounts will help to avoid this.
- MUSIC AND FILMS – You are not paying to own the content in a real sense, more that you are paying for a licence to use it during your lifetime. Depending on which outlet the agreement is with, there may not be a way around this but checking with the company in question is a good place to start. It may be possible to bequeath your licence to someone who'll be able to make further use of it.
Source: Saga Legal Services' Digital Legacy Guide
The process of applying for the right to deal with a deceased person’s estate. If a person has left a will, they will usually have appointed a will executor. The executor then has to apply for a ‘grant of probate’ from the probate registry, which is a legal document that confirms the executor has the authority to deal with the affairs of the deceased. If a person dies without making a will, intestacy law applies (see intestate).
The tax levied on the total value of your estate after you die. IHT has to be paid by the beneficiaries of your estate before they can receive any of the money from it. The money can’t be taken from the value of the estate _– it has to be paid before any money can be released. There is an IHT threshold – known as the “nil-rate band” – below which no tax is levied (£325,000 in 2011/12). Any amount above the nil-rate band is subject to tax at 40%. If your estate totals £600,000, there is no tax on the first £325,000; however your estate will pay 40% tax on the remaining £275,000, a total of £110,000. Prudent tax planning can reduce your IHT liability, so always consult a specialist solicitor.