How Virtual Property Is Treated in Probate

Virtual property is no longer a fringe concept. Digital land, in-game assets, metaverse property, virtual businesses and platform-based ownership rights are now appearing with increasing frequency in probate estates. Despite this, many families and even executors are uncertain how virtual property is treated during probate — or whether it needs to be declared at all.

The reality is clear: where virtual property has financial value, it must be identified, valued and reported as part of the estate.

With over 12 years of specialist probate valuation experience across England, Scotland and Wales — and with zero HMRC rejections — FEAC Legal regularly handles estates containing virtual and platform-based assets that would otherwise be overlooked.

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What Is Considered Virtual Property in Probate?

Virtual property refers to digital assets that exist within online platforms, virtual environments or proprietary systems and may include:

• Virtual land or buildings (metaverse platforms)
• In-game items with resale value
• Digital real estate tied to NFTs
• Virtual businesses or storefronts
• Platform-based currencies or credits
• Tradeable digital avatars or skins
• Virtual collectibles
• Tokenised virtual assets
• Access-based or membership assets with resale value

If these assets can be sold, transferred, licensed or exchanged for real-world currency, they may form part of the estate.

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Virtual Property Is Treated as Intangible Property

For probate purposes, virtual property is treated as intangible property, not as a novelty or personal hobby.

This means:

• It may have open-market value
• It forms part of the deceased’s estate
• It must be declared if financially relevant
• It can affect inheritance tax calculations
• Executors are responsible for reporting it

HMRC focuses on value, not format. If it is worth money, it matters.

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Why Virtual Property Is Commonly Missed in Estates

Virtual property is often overlooked because:

• It has no physical presence
• Ownership exists only within platforms
• Access depends on login credentials
• Families may not understand its value
• It may be dismissed as “gaming” or “digital”
• Accounts are often private or password-protected

As a result, valuable assets can be lost, expired or left undeclared.

FEAC Legal’s free asset recovery service helps identify digital and virtual assets across devices and accounts before they disappear (see our Asset Recovery service).

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How Virtual Property Is Valued for Probate

There is no single method for valuing virtual property. A professional probate valuation considers:

• Market demand within the platform
• Comparable recent sales
• Transferability rules
• Platform restrictions
• Associated intellectual property rights
• Whether the asset generates income
• Liquidity and resale potential
• Volatility of the underlying market

All valuations must reflect realistic open-market value at the date of death, not speculative future worth.

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Platform Rules Can Affect Probate Value

Unlike physical assets, virtual property is governed by platform terms and conditions.

Valuers must assess:

• Whether assets can be transferred on death
• Whether resale is permitted
• Whether accounts are non-assignable
• Whether assets are linked to personal identity
• Whether value is restricted to in-platform use

These restrictions directly affect probate value and must be reflected accurately.

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Virtual Property and Cryptocurrency Are Often Linked

Many virtual assets are acquired using cryptocurrency, meaning estates often include:

• Virtual property
• NFTs
• Cryptocurrency wallets
• Platform-based tokens

Missing one frequently means missing the others. This overlap makes comprehensive digital asset identification essential.

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Virtual Businesses and Income-Generating Assets

Some virtual property goes beyond ownership and actively generates income, such as:

• Virtual shops or storefronts
• Advertising space within platforms
• Rent-like income from virtual land
• Access-based memberships
• Licensed virtual environments

Where income exists, the asset’s value may be significantly higher and must be treated accordingly in probate valuations.

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Executor Responsibilities and HMRC Risk

Executors are legally responsible for ensuring all estate assets are declared.

Failing to include valuable virtual property can lead to:

• HMRC queries or investigations
• Delays to probate
• Penalties for inaccurate reporting
• Claims of executor negligence
• Disputes between beneficiaries

Professional probate valuation protects executors by ensuring assets are identified and reported correctly.

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Virtual Property in Multi-Beneficiary Estates

Virtual assets can create disputes where:

• Assets cannot be divided
• One beneficiary wants to retain them
• Others want immediate financial value recognised
• Future value is contested

A formal probate valuation establishes a clear financial figure, allowing fair compensation or distribution.

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Why Professional Valuation Is Essential for Virtual Property

Virtual property requires specialist probate valuation because it:

• Is intangible and platform-dependent
• Is easily overlooked
• May fluctuate significantly in value
• Is governed by restrictive contracts
• Can materially affect estate value and tax

Assumptions or omissions create risk. Evidence-based valuation creates protection.

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Why Families Choose FEAC Legal

Executors, solicitors and families trust FEAC Legal because:

• We have over 12 years of probate valuation experience
• Our HMRC-compliant reports have never been rejected
• We understand digital, virtual and intellectual property assets
• We identify assets others miss
• We provide full documentary and photographic inventories
• We include a free asset recovery service
• We work with private clients, executors and solicitors
• We cover England, Scotland and Wales

Virtual property may not exist physically — but its impact on estate value is very real.

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Contact FEAC Legal

Email: admin@feaclegal.co.uk
Phone: 07984733931
To make an enquiry or request a valuation, please contact us.