The number of cohabiting couples in the UK has risen significantly in the last 20 years, more than doubling to 3.3 million families*. However, two thirds of those couples** don’t realise there is no such a thing as common law marriage and that cohabiting couples don’t have the same rights as married couples or those in civil partnerships. You could be together for many years and have children and, depending upon your circumstances, be left with no assets or financial support in the event of a split.
What can you do?
Many cohabitees only take advice following the breakdown of the relationship, by which stage it is often too late to effect protection. Nonetheless, there are a variety of protective measures you could take, including:
- Evidence your intentions: you could enter into a Cohabitation Agreement with your partner to set out your joint intentions in relation to your finances, property and arrangements for any children. You can enter into this agreement before you move in with your partner or at any point once you are living together. It is important to note that Cohabitation Agreements are legally binding contracts, if drafted and executed properly. However, it is essential to have other documents in place to ensure that your intentions are followed in respect of your property and, in the event of your death, the distribution of your estate. All these documents must ’mirror’ each other.
- Protect your property rights: you may decide you would like to own a property on an equal basis with your partner and for your partner to automatically inherit your half share of the property or, alternatively, you may choose to depart from this as a result of any contributions you have made to the purchase, mortgage payments and maintenance of the property. If the latter, we recommend you document your position and complete a Declaration of Trust. One of the benefits in ensuring a declaration has been completed is that it should, hopefully, prevent arguments as to who gave what at the beginning and who should get what when a property comes to be sold. A Declaration of Trust can, and should be, registered at the Land Registry.
- Complete a Will: in the absence of a Will, as a cohabitee, the rules of intestacy apply and you would not automatically be entitled to inherit anything when your partner dies; you should both ensure you have a Will in place.
Planning for a potential break-up has to be the least romantic decision any couple can take, but it might pay to be pragmatic in order to save a great deal of emotional and financial heartache down the line.
The current situation is likely to change: the Cohabitation Rights Bill addresses the rights of cohabiting couples to a point, and is making its way through parliament. It aims to confer similar rights – though not equal - on cohabiting couples that are already enjoyed by couples who are married or in a civil partnership, including a right to apply to the Court for a financial settlement up to two years after separating.
If you do find you are at a point of separation and unable to agree a way forward, there are various avenues that might offer a solution or a route to an agreement with your ex-partner.
If you would like any advice in relation to the above, please call 01403 252492 to speak our Family team who would be happy to assist.
*ONS Families & Households, 2017