Cryptocurrency & Inheritance: What UK Investors Need to Know After the 2024 Budget 

As digital assets continue to move from the fringe to the mainstream, crypto investors are now facing increasing scrutiny from HMRC — and with the UK Spring Budget 2024 came several announcements that will reshape how wealth, especially crypto wealth, is taxed and passed on. 

If you’re holding significant amounts of crypto, thinking long-term about your estate, or wondering how non-dom reforms could affect your tax residency planning, this blog is for you. 

Inheritance Tax (IHT) Still in Focus — Crypto Counts 

The UK Government has not abolished Inheritance Tax, despite speculation in the lead-up to the Spring Budget. The nil-rate band remains at £325,000 (unchanged since 2009), with the additional residence nil-rate band of £175,000 still in place for property passed to direct descendants. 

Why it matters for crypto investors: 

Cryptoassets — including Bitcoin, Ethereum, NFTs, and tokens — are considered property by HMRC. Upon death, these are added to the total value of your estate for IHT purposes. That means: 

• If your estate, including crypto, is valued above £325,000, you could face a 40% tax on the amount above that threshold. 

• Crypto can’t be easily discovered or accessed by executors unless clearly documented, risking asset loss and compliance issues. 

Tip: Ensure your Will or estate plan includes wallet locations, private key instructions, and clear crypto valuations. 

The Crypto-Specific Challenges of IHT 

Crypto poses some unique complications when it comes to inheritance: 

• Access: If private keys, seed phrases, or wallet login info aren’t shared securely, your heirs could lose access — and the assets — forever. 

• Valuation: Crypto values fluctuate wildly. Your estate may need to provide a fair market value at date of death, even for assets that aren’t easily liquidated. 

• Disclosure: Executors may not even know you own crypto unless it’s clearly documented. 

Major Changes for Non-Doms — Crypto Held Offshore Now at Risk 

One of the biggest shakeups in the 2024 Budget is the abolition of the remittance basis for non-domiciled individuals starting April 2025. This will significantly impact crypto holders with offshore wallets or who previously relied on non-dom status to avoid UK taxation on foreign (or crypto-derived) gains. 

What’s changing? 

• The current system that allows non-doms to avoid UK tax on overseas income/gains if not brought into the UK is being scrapped. 

• A new 4-year foreign income and gains (FIG) regime will apply to recent UK arrivals. 

• Crypto held abroad or on offshore exchanges could now fall into HMRC’s jurisdiction regardless of remittance. 

• New Residence Test: From April 2025, individuals will be subject to IHT on their worldwide assets if they have been UK residents for at least 10 out of the last 20 years. 

Tip: If you’ve been using a non-dom structure to shield crypto profits from UK tax, 2025 will bring a significant shift. Now is the time to review your residency and structuring with a crypto tax specialist. 

Crypto Entrepreneurs & BADR – A Missed Opportunity? 

Business Asset Disposal Relief (BADR) — formerly Entrepreneurs’ Relief — offers a 10% CGT rate (instead of 20%) on the sale of qualifying business assets, including shares in a company. 

Unfortunately, no major changes to BADR were announced in the Spring Budget, and the £1 million lifetime cap remains. For Web3 founders, DeFi startups, or NFT platforms, this could be limiting when exiting high-growth crypto ventures. 

Crypto founders should consider: 

• Structuring early to qualify for BADR 

• Holding shares personally (not in trusts or offshore vehicles) 

• Staying aware of shareholding and employment requirements 

Tip: Advanced planning is key — failing to qualify for BADR could mean a higher CGT bill on your startup exit or token launch. 

Pension Funds Now Subject to Inheritance Tax 

Starting 6 April 2027, unused pension funds and death benefits will no longer be exempt from Inheritance Tax (IHT). Previously considered outside the scope of IHT, pension pots — especially defined contribution schemes — will now be taxed like other assets in your estate. 

Tip: Many high-net-worth individuals, including crypto investors, have relied on pensions as a tax-efficient wealth transfer tool. With this change, those with substantial pension savings and crypto holdings could now see a larger portion of their estate fall within IHT liability. 

What Should Crypto Investors Do Now? 

With these new and pending changes, UK-based crypto investors should be proactive, not reactive. 

✅ Estate Planning for Crypto 

• Include crypto in your Will 

• Document wallet access and private keys 

• Use trusts to mitigate IHT liability 

✅ Prepare for the End of Non-Dom Relief 

• Re-evaluate offshore wallet strategies 

• Consider UK tax implications for global gains 

• Explore UK trust and domicile planning options 

✅ Business Exit Planning (BADR) 

• Check if your crypto startup structure qualifies 

• Plan for potential share disposals or token launches 

• Model CGT outcomes under BADR vs full rate 

Final Thoughts 

The 2024 Budget may not have delivered sweeping tax cuts, but it clearly signals HMRC’s intention to modernise tax enforcement, especially around global income, digital assets, and wealth transfer. 

Crypto investors must be vigilant and forward-thinking. Whether you’re staking ETH, managing a DeFi protocol, or holding significant assets in cold storage — the tax implications are real, and changing fast. 

Need Help Navigating Crypto Tax and Estate Planning? 

At MyCryptoTax, we specialise in crypto tax compliance, advisory, and estate planning. We work with investors, founders, and high-net-worth individuals to: 

• Optimise crypto tax strategies 

• Prepare for IHT and future estate planning 

• Address non-dom impacts and international tax issues 

• Advise on company exit planning and BADR eligibility 

Book a free consultation today or visit www.mycryptotax.co.uk 

Let’s secure your crypto legacy. 

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DISCLAIMER

© My Accountancy Team 2025 All Rights Reserved – The above articles are provided for guidance only and may not cover your personal circumstances so you should not rely on them. It is important that you seek appropriate professional advice which takes into account your personal circumstances where you can provide the full facts of the case and all documents related to your case. My Accountancy Team Ltd t/a mycryptotax.co.uk, cannot be held responsible for the consequences of any action or the consequences of deciding not to act.