Inheritance and gift of crypto-assets: tax and access planning

Inheriting crypto-assets is not like inheriting a flat or a fund portfolio. The tax plane is, in essence, that of any other estate: there is an Inheritance and Gift Tax (ISD), there is the deceased’s income and there is a Wealth Tax to review.

What changes is the plane that no notary resolves: who will be able to move the assets when the holder is no longer here. This guide addresses both at once, because planning that attends only to one of them fails on the other.

1. Owning is not the same as being able to sign

Let us start with a premise that usually remains implicit. In a bitcoin estate, the succession may be legally impeccable and yet not guarantee access to the assets.

The heir may have a perfect right over the assets —a clear will, ISD settled, deed of partition— and be unable to move a single satoshi. It is enough that they do not know where the keys are, what software was used, whether there is an additional passphrase or whether part of the estate lives in a multisig scheme or in a Lightning node that no one knows how to identify.

It is worth retaining a key distinction here. One thing is legal ownership —who has the right to the assets— and quite another is technical access —who can effectively dispose of them. In the crypto world the two do not travel together by default: the private key is not transmitted because the will says so, but only if someone left a path to recover it.

Hence, in practice, three layers must be worked on at once. The legal one: who inherits. The documentary one: what exists and where it is. And the technical one: how it is recovered and signed without losing funds or compromising security. The serious error is to trust everything to the first. Sections 2 to 6 order the tax layer; 7 to 11, the other two.

2. The deceased: the latent gain is not taxed on death

When a holder of crypto-assets dies, their last IRPF return does not recognise the gain accumulated over years of holding. Article 33.3.b LIRPF says so without qualification: “it shall be deemed that there is no capital gain or loss […] on the occasion of gratuitous transfers on the death of the taxpayer.”

This is what Anglo-Saxon literature calls a step-up in basis —an expression to be handled with caution, because it does not belong to Spanish technical-legal language—: the latent gain is not taxed at the level of the deceased and the acquisition base is “reset” in the heir at the inheritance value. An example fixes the idea.

Scenario. The deceased acquired 5 BTC in 2017 at an average price of €3,000/BTC (total cost, €15,000). On the date of death bitcoin trades at €90,000.

• Accumulated latent gain: 5 × (90,000 − 3,000) = €435,000.
• Taxation in the deceased’s IRPF on that gain: €0 (Article 33.3.b LIRPF).
• Acquisition value “inherited” by the heir: 5 × 90,000 = €450,000 (we will see this in the next section).
• If the heir sells immediately, their gain is zero. If they sell later at €100,000/BTC, they are taxed only on 5 × 10,000 = €50,000, the increase after the inheritance.

The planning consequence is direct and often counter-intuitive: for assets with a large latent gain, transferring mortis causa is fiscally far superior to gifting during one’s lifetime.

There is one condition, though. The advantage must be real and not theoretical, and that depends on the heir being able to actually access the bitcoin. Here the two planes connect.

3. The valuation in Inheritance Tax fixes the future acquisition base

Where does that €450,000 acquisition value of the heir come from? It is not a figure they choose. Article 36 LIRPF ties it to the ISD valuation: in gratuitous acquisitions, “the real amount of the respective values shall be taken to be those resulting from the application of the rules of the Inheritance and Gift Tax, without being able to exceed the market value.”

Translated: the value declared in the inheritance will tomorrow be the heir’s acquisition cost for the purposes of their IRPF.

And how is the crypto-asset valued for ISD? At its market value as at the date of death. Article 9 LISD provides that the taxable base in an inheritance is “the net value of the individual acquisition of each beneficiary”, and that that value, absent a special rule, is “its market value”, understood as “the most probable price for which a charge-free asset could be sold between independent parties.”

A frequent misunderstanding should be ruled out here. The cadastral reference-value rule so often cited in inheritances does not apply to crypto-assets: it is exclusive to real estate. A bitcoin has no cadastral value; it is valued by its market price. DGT ruling V0502-25, of 27 March 2025, even though it resolves a real-estate case —whose base is precisely the reference value—, runs through Article 9 LISD and confirms its general rule: absent a special rule, the taxable base is the market value of the asset. That is the one governing crypto-assets, which have no reference value.

This makes the valuation a double-edged decision. Declaring low reduces the ISD bill today, but lowers the heir’s acquisition base and enlarges their future IRPF gain when they sell; it also exposes one to administrative review. Declaring high increases the ISD, but “raises” the base and reduces the future gain.

The correct figure is a single one: the market value as at the date of death, documented with the price of a reference exchange or a reasonable average. It is not a parameter to be forced in any direction.

On the available doctrine. There is, as of today, no specific state-level DGT ruling on the valuation of inherited crypto-assets. The question is resolved by the general rules (Articles 36 LIRPF and 9 LISD) and by the doctrine on the valuation of crypto-assets in other taxes. Faced with any text invoking a specific ruling to support this point, it is advisable to check the number in the DGT search tool before taking it as good.

4. Wealth Tax, before and after

Two Wealth Tax reviews accompany the succession.

That of the deceased: if their net worth exceeded the threshold, the crypto-assets had to be declared at 31 December at their market value, like wealth in foreign currency. So the DGT established in rulings V0250-18 and V2289-18. It is important that the deceased’s last Wealth Tax return be consistent with what is later declared in the inheritance. A striking discrepancy between the crypto wealth declared in life and that which “appears” in the estate —the set of assets and rights left by the deceased— is a signal the authorities know how to read.

And that of the heir: from the tax year of the acquisition, those crypto-assets come to form part of their own Wealth Tax, again at market value at 31 December. It is a recurring cost that family planning should not forget, especially if the inheritance pushes the heir above their exempt minimum.

5. Regional ISD: the deceased’s residence decides

ISD is a tax ceded to the autonomous communities, which set their own reductions, scales and rebates. The differences between territories are large, and that turns an apparently minor fact —where the deceased resided— into the first planning lever.

The connecting point is in Article 32.2.a) of Law 22/2009: in acquisitions on death, the revenue belongs to the community “where the deceased had their habitual residence as at the accrual date”. The accrual, in an inheritance, is the moment of death.

And habitual residence is not the last registration. It is the territory where one has stayed for the most days “in the period of the five immediately preceding years, counted from date to date”, under Article 28 of the same law. A last-minute move of convenience does not change the competent community; the average of the last five years is what is looked at.

On the specific map one must be honest and prudent at once. After the wave of reforms in 2023 and 2024, most communities today rebate around 99%–100% of the charge for the closest relatives —spouse, descendants and ascendants, the so-called groups I and II—, so that in those cases the ISD bill is usually nominal.

The hard contrast is in groups III and IV: siblings, nephews and nieces, cousins and, above all, unrelated persons. There the rebates rarely apply and the scale, with its multiplier coefficients, can be severe in almost all of Spain. For crypto wealth this weighs more than for other assets, because it is not unusual to want to leave assets to a partner, a friend or someone outside the family circle. It is precisely the scenario the system penalises.

Two cautions before closing the point. First: the regional figures change with each budget, so any specific percentage must be checked against the community’s rules in force before planning. Second: competence is determined by the deceased, not by where the heirs live. A deceased with habitual residence in a heavily rebating community benefits their heirs wherever they live.

6. Gifting in life is not the same as leaving by inheritance

The tax asymmetry between gift and inheritance is the other great axis of decision. An inheritance does not generate a gain for the deceased; a gift does generate one for the donor.

Gifting is a gratuitous inter vivos transfer. Article 33.1 LIRPF, together with the already-cited Article 36, requires the donor to recognise as a capital gain the difference between the market value of the gifted crypto-asset and its acquisition cost. On the donee, in addition, falls the ISD.

The administrative doctrine has confirmed this for the gratuitous transfer of cryptocurrencies, which is subject to ISD and IRPF at the market value of what is transferred. So records, among others, ruling 181/18, of 2 July 2018, of the Generalitat of Catalonia —of a merely informative nature, since the binding answer under state legislation falls to the Directorate-General for Taxes of the Ministry of Finance.

It is worth clarifying a point often overlooked, because it is counter-intuitive. Even though in a gift the donor receives nothing in return, the tax rule treats the handover as if they had transferred the crypto-asset at its market value. Therefore, where there is a latent gain —the crypto-asset is worth more today than it cost—, that gain surfaces and is taxed in the donor’s IRPF, just as if they had sold it.

The relevant consequence is seen in the reverse case. If the gifted crypto-asset accumulates a loss —it is worth less than it cost—, one might think the donor can at least use that loss to offset other gains. It is not so: Article 33.5.c) LIRPF provides that capital losses due to gratuitous inter vivos transfers are not recognised. Put practically, the gift surfaces gains, but does not allow losses to be used.

The asymmetry is no small thing in a portfolio with acquisitions at very different prices. To decide between gifting and inheriting it is not enough to attend to the donee’s ISD and the rebate of their autonomous community: one must also assess whether the asset being transferred accumulates a latent gain or loss, since only the former has a cost in the donor’s IRPF.

The same scenario, by both routes, makes it clear.

Scenario. 2 BTC, acquisition cost €5,000, current value €90,000/BTC. Transfer to an adult child. Deceased/donor and heir/donee reside in a community that rebates 99% for group II.

• Gift in life. Donor’s gain: 2 × (90,000 − 5,000) = €170,000; IRPF at the savings rate, of the order of €44,000. Donee’s ISD: almost fully rebated, close to €0. Donee’s acquisition base: €180,000. Total cost ≈ €44,000.
• Inheritance. Deceased’s IRPF on the gain: €0 (Article 33.3.b). Heir’s ISD: rebated, close to €0. Acquisition base: €180,000. Total cost ≈ €0.

From this a general rule is drawn: for assets with a high latent gain, transfer on death is usually more efficient than a gift in life. The gift retains sense in specific cases —where the donee needs the assets during the donor’s life, where the gain is small or negative, or where it is worth splitting to take advantage of renewable reductions—, but it starts with the disadvantage of the donor’s IRPF.

Two nuances remain.

First, the connecting point changes in a gift. For gifts of assets that are not real estate —and the crypto-asset is that, an intangible movable asset— the competent community is that of the donee’s habitual residence (Article 32.2.c of Law 22/2009), not the donor’s. The flat statement that “the deceased’s residence always governs” or “the donee’s always” is therefore wrong: the answer depends on the mode of acquisition and the type of asset. This creates asymmetries in families spread across several communities.

Second, the “family business” does not save a gift of crypto-assets. The exemption of the donor’s gain under Article 33.3.c) LIRPF requires the gift to fit the reduction of Article 20.6 LISD, designed for businesses and shareholdings. A holding of bitcoin as an investment is not a business; there is no shortcut by that route.

Special mention is due to the succession agreements (pactos sucesorios) of the communities with their own civil law (Catalonia, the Balearic Islands, Galicia or the Basque Country, among others). Article 36 LIRPF, second paragraph, introduced from 2021 a caveat: if the beneficiary of an agreement “with present effect” —one that allocates assets while the deceased is still alive— transfers the asset before five years or before the deceased’s death, they take over the original value and date of acquisition where these are lower. It is a powerful tool and at the same time one with a deadline trap; any planning with a succession agreement over crypto must read that paragraph carefully.

Matrimonial property regime. If the bitcoin was acquired during the community of acquests (sociedad de gananciales), its distribution on dissolution does not generate a gain: Article 33.2.b) LIRPF excludes the change in net worth on the dissolution of the community of acquests. Determining which part of the crypto estate is community property and which is separate is a step prior to any succession, and has its own complexity when the assets were bought and moved over the years.

7. The three layers of the plan, in order

With the tax plane resolved, what the rule does not resolve remains. Useful planning works on three distinct and coordinated documents.

Legal layer: the will. It allocates the assets and designates, where appropriate, an executor or trusted person with a technical profile. It decides who inherits.

Documentary layer: the inventory and instructions. A document, separate from the will, that explains what exists and where it is: which wallets, which custodians, which devices, which backups and which support persons. It contains no secrets; it orients. For many heirs, the first obstacle is not even knowing that the deceased had bitcoin.

Technical layer: the access architecture. The specific design —single-sig, passphrase, multisig, fragmentation— that allows recovery and signing without exposing the secret more than necessary. It decides how access is gained.

The most common error is to compress the three into one, usually the will. That is precisely what should not be done, and the reason is one of security, not form.

8. Will, yes; keys, never

Here it is worth being categorical. The will must allocate the crypto-assets and designate roles. What it must never contain is the seed phrase (the wallet’s recovery words), the passphrase, a private key or any combination that allows a third party to take the funds.

The reason is the exposure surface. In Spain, the General Registry of Last-Will Acts allows it to be known, after death, whether there is a will and before which notary it was granted; and those who can show a legitimate interest may obtain an authorised copy of its content. A will is not a confidential document: when the time comes, a wider circle of people accesses it than is usually assumed. Each piece of the seed incorporated into the will increases the number of people who could dispose of the funds.

The rule, then, states itself: the will says who receives the assets; it must never contain, on its own, what is needed to take them.

Should it mention bitcoin? Yes, in its patrimonial dimension: naming the existence of “digital assets or crypto-assets” and ordering their allocation as normal, so as not to leave them out of the planning as an informal black box. Describing the estate is one thing; handing over the master key inside the succession instrument is quite another.

9. The access document: separate, clear and operational

The central piece of a well-designed crypto inheritance is not the will; it is the instructions document, kept apart. It does not replace the will: it resolves the part the will should not absorb.

Its function is not to teach Bitcoin from scratch or to leave a riddle for the family. It is practical: to allow someone sad, stressed and probably unfamiliar with the operation to reconstruct the path without guesswork. A good access document identifies the universe of assets and allows control to be recovered; it does not need to reveal exact amounts if that adds nothing operationally.

A structure that works:

1. An initial message, brief and human, explaining why the document exists and what it is for.
2. A functional inventory of accounts, wallets, nodes, exchanges, devices and media.
3. A map of locations: where the seed is, where the passphrase is, where the hardware is, where the secondary copy is and who knows each piece.
4. Trusted persons and technical support, in order of priority, with contact details and the reason for the trust.
5. Indications for special schemes: multisig, Lightning nodes, BIP39 passphrase, SLIP39, two-factor accounts, custodians with their own succession procedure.
6. Operational cautions: do not move funds in a hurry, do not enter seeds on connected devices, do not accept help from strangers, do not mix recovery with an immediate sale without first reviewing the tax impact.

For each wallet or account it is advisable to record, as a minimum, an internal identifier; the type of environment (hardware, software, multisig, exchange, Lightning); the software or hardware with which it was created and is managed; the location of the main and the alternative copy; whether or not there is an additional passphrase and where it is kept, without transcribing it in full in the same document; and any peculiarity of derivation paths that may be relevant.

10. Custody designs, read in a succession key

There is no single correct model. The reasonable one depends on the size of the estate, the family’s technical level, the privacy sought and the operational cost the holder is willing to bear in life. Each option has its own inheritance reading.

Single-sig. The easiest to inherit and the easiest to lose: everything depends on properly protecting a single seed and its environment.

Single-sig with passphrase. It improves compartmentalisation, but adds a characteristic risk: that the family recovers the seed and does not know that a passphrase is missing. If it is used, the access document must warn of it unequivocally.

Multisig (m-of-n). The best solution for high net worth. A 2-of-3 scheme —holder, trusted person, qualified custodian— allows two parties, after death, to operate without recovering the deceased’s key. It requires thoroughly documenting the quorum, the location of each key and the role of each participant, and keeping the output descriptors (the data that allow the wallet to be reconstructed) in the access document.

SLIP39 / Shamir. It fragments recovery into parts, of which a subset is needed to reconstruct. Useful for eliminating the single point of failure, but only if the heir or their technical support can execute it without improvising.

Exchange or regulated custodian. It reduces technical complexity and usually has its own succession procedure (death certificate, proof of the heir). In exchange, it introduces counterparty risk. Under the automatic-exchange-of-information framework, moreover, these balances will be reported to the authorities.

Lightning and nodes. They deserve separate treatment. It is not enough to note “there are also funds in Lightning”: one must indicate whether there is a static channel backup (the backup of the channels), where it is, what software is used and what can really be recovered from the seed as against what depends on additional copies.

A design warning: the more sophisticated and cryptic the system, the greater the probability that the failure is caused by the complexity itself. In succession, operational simplicity is usually preferable to defensive originality.

And the automatic dead man’s switch —the system that releases assets if the holder does not “press the button” every so often— should be avoided as an inheritance mechanism. It generates false positives through an illness or a long trip and is not sufficiently tested for high net worth.

11. Executor, technical support and the legibility test

In relevant crypto estates it makes sense to separate functions. One is the heir or legatee; another, the executor or estate partitioner; another, a person with technical aptitude who assists in recovery without taking control. Sometimes they coincide in a single person; often it is best to split them.

The rule that orders the split is need-to-know: no one should know more than strictly necessary to perform their function. Designating a trusted technical support greatly reduces operational risk, and precisely for that reason one must avoid giving them access to the full secret if the design allows compartmentalisation.

The plan, finally, is not drafted once and forgotten. It is reviewed every time the setup changes —new wallet, new hardware, new multisig, new passphrase, new custodian—, each version is dated and the previous ones are securely destroyed.

And it is submitted to a test that is not legal, but operational: if a non-technical person, assisted by someone trusted, could understand the document and reconstruct the path without improvising, the plan is probably sound. If it depends on things only the holder knew and never wrote down, the plan is not finished.

In the inheritance of crypto-assets the problem is not exhausted in the legal transfer; it includes allowing recovery without exposing the access secret more than necessary. The tax plane favours transfer on death and a careful valuation. The technical plane requires separating the will from the access secret and keeping the architecture simple enough for the family to execute it. Attending to only one of the two planes leaves the planning incomplete.