Every day, couples who are unmarried or not in a civil partnership make the huge decision to move in together, and there are now more cohabiting couples in the UK than ever before. This is a trend that looks set to continue, however UK law hasn’t evolved to reflect this reality by better aligning the rights of cohabiting couples with those of married couples and civil partners.
There is a general misconception that cohabiting couples are somewhat protected by the law, and many people are surprised to hear that the law grants far fewer rights to cohabiting couples than to spouses. This can have significant consequences when it comes to home ownership and occupation, access to bank accounts, tax breaks, pension pay-outs, inheritance and more. And where families with children merge, this can add yet another level of complexity in relation to parental rights and responsibilities.
Sadly, most cohabiting partners only discover all of this once a relationship breaks down or a partner dies, by which point it’s often too late. The harsh reality is that, without the right legal advice, you may have no entitlement to your partner’s assets if you split up or they pass away, even if you have cohabited for many years.
Below is an overview of some of the key considerations for cohabiting couples.
If you move into a property owned solely by your partner and they ask you to leave, you may have no choice but to respect their wishes. This is likely to be the case even if you have made it your home over a number of years and have children living with you.
Moreover, if your cohabiting partner passes away, you won’t automatically have the right to remain in their home – even if you have lived there for decades – nor any right to the sale proceeds (unless you can prove you have made a financial contribution to the property, in which case you may be entitled to only a small portion).
This can put people in impossible positions; positions that could easily have been avoided had they understood their rights and put in place the appropriate legal documents at the outset. To that end, there are various steps you can take to avoid these types of situations arising, and we can help you to identify and implement the most appropriate measures for you.
For example, you can avoid future disputes and legal processes by ensuring you both have in place a Will that clearly and comprehensively sets out your most up-to-date wishes. Moreover, steps can be taken to transfer a property from your partner’s sole name into your joint names. Doing so can help to ensure that you are both entitled to a share of the proceeds when the property is sold, and that if one of you dies, the other will have greater inheritance rights.
Note that it’s possible to own specific shares in a property, which can provide a flexible solution where one of you wants to leave a portion of the property to someone else (which is commonplace in merged families, for example).
If renting, it’s a good idea to have the tenancy agreement in both your names to protect your position, including the right to remain in the property if the other person leaves or sadly dies. The downside of course is that you may become liable for paying the rent and any other charges should the other person default, leave or pass away.
If you live with someone who has a child from another relationship, the law does not automatically impose parental responsibility on you for that child. Whilst that might be perfectly fine if you have recently moved in with a new partner and their child, bear this default position in mind as the years go by and your relationship with that child evolves. One option might be to explore formal adoption procedures, although this is unlikely to be the case if the child’s birth parent is still around.
Moreover, where unmarried couples have children, they should consider the legal implications of how they register the birth. For example, an unmarried mother is granted automatic parental responsibility for her child, whereas an unmarried father may only receive the same rights if he is named on the birth certificate. It is important to consider these implications in case you later split up and want to continue to share responsibility for that child’s future.
Next of Kin Status
If your partner falls ill or dies, you may not be considered to be their next of kin for medical purposes unless you have a written agreement to confirm this, or proof of marriage or a civil partnership. In such circumstances (in the very worst cases), their legally-recognised next of kin may even be able to prevent you from seeing your partner, influencing their treatment, and – if the worst were to happen – arranging their funeral.
Putting in place a Lasting Power of Attorney can solve many of the potential problems that would otherwise arise in relation to you or your partner not being classed as the other’s next of kin. This document can enable you to access your partner’s assets should you ever need to, whilst ensuring the person you trust most will be responsible for your health and welfare in later life.
Bear in mind that if you and your partner have separate bank accounts and your partner is severely injured, loses their mental capacity or dies, you will be unable to access their bank accounts – even to make essential payments – if your partner hadn’t put in place the necessary documentation granting you access.
Co-habiting couples are not afforded the same tax benefits as married couples or those in civil partnerships. This means that you may have to pay tax if you want to transfer significant assets to your partner, and it can affect the treatment of those assets for Capital Gains and Inheritance Tax purposes.
If you die, your state pension will not automatically pass to a cohabiting partner. If you have private pensions, you will need to make enquiries into who can be named as a beneficiary and what level of pension can be transferred to them. It is likely that you will have to make a formal declaration appointing a beneficiary, and there may be tax implications relating to your beneficiary not being your legal partner or child.
Making a Will
A clear and professionally drafted Will can ensure that your wishes are accurately recorded, that the assets you’ve worked so hard for are passed on to those you care most about, and that any dependants will be provided for once you’re no longer around.
A Will is particularly important if you are in a committed relationship but not married or in a registered civil partnership, as you will otherwise have no automatic right to a share of your partner’s assets if they pass away.
If you and your partner discuss and record your intentions for your assets from the start, this can help to avoid the potential for an acrimonious split further down the line. To that end, cohabitation agreements are slowly gaining recognition as a great option for cohabiting couples who are looking to formally record their intentions with regards to their combined assets (although the extent to which courts are willing to enforce every aspect of these agreements is not currently clear). Having a professionally structured, drafted and negotiated Cohabitation Agreement will truly reflect your intentions and alleviate your concerns.
How can we help?
We can use our extensive legal knowledge and experience to help you anticipate, understand and manage the potential issues that can arise in relation to your status as a cohabiting partner. This includes explaining your default legal rights, helping you to understand where you and your partner would stand in certain situations, and explaining what you can do to make your position more secure.
For further information, or to make an appointment, simply call a member of our family team to discuss your situation and get a clear, competitive costs estimate, with no hidden extras.
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