In today’s society, many couples chose not to marry but to live (cohabit) with their partner.
According to the Office for National Statistics, in 2014 there were 247,372 marriages in England and Wales between men and women.
This is a far cry from the 349,000 marriages thirty years ago.
They also reported that the average age of marriage was at an all-time high of 34-37 years old.
So, with this in mind, where do cohabiting couples stand when it comes to the laws surrounding inheritance?
Unfortunately without a Will, cohabiting couples are not recognised in the eyes of the law in relation to inheritance. This means that a bereaved partner is currently legally entitled to nothing.
The only exceptions to this rule are if they own their house as joint tenant (joint owners) or are to receive their partner’s life policy, where the deceased has completed a nominee form in the partners favour.
In some cases, couples have been together decades and also share children.
This is where it can get a little tricky for the remaining partner.
If the surviving partner (or anyone else) hasn’t been named in a Will (or there is no Will), under the intestacy rules, the children of the partnership are automatically first in line to receive the estate.
In order to legally inherit, the surviving partner would have to claim against their children, which can be stressful, costly and may cause a family dispute, but they may need to do this in order to obtain money or assets to live on.
Cohabiting couples also lose the benefit of not being able to use their partner’s inheritance tax allowance. Currently, married couples or those on a Civil partnership have the ability for the surviving spouse / Civil partner to use their deceased spouse / partners inheritance tax (IHT) allowance, thus saving on potential tax upon second death.
Currently, gifts between spouses are exempt from IHT, whereas for cohabiting couples, if the assets exceed £325,000, IHT is charged at 40%.
In order to ensure your partner is provided for when you die, it is vital you make a Will and name them.
Without this, there is no protection for them, and you may literally leave them homeless and with nothing.
If you love them, protect them.
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