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Society has changed. Cohabiting couples have become the fastest growing family type in the UK, doubling from 1.5m families in 1996 to 3.3m families in 2017. I’ve got many friends living as unmarried couples/families for various reasons. For some, previous divorce has put them off marrying again. For others, financial constraints mean they can’t simply afford to get married.

Many of them are parents too which adds an additional layer of complexity to the puzzle.

Unmarried couples who live together have different legal rights to married couples and it is important to have these in mind in terms of how you approach your finances. It’s a sad reality that cohabiting couples have an even higher rate of break up than married couples so its pays to be aware of the implications if this were to happen.

The Cohabitation Rights Bill, which addresses the rights of cohabiting couples, is in the early stages of passing through Parliament. In the meantime, there are ways to ensure a degree of legal protection if you aren’t married; something to bear in mind particularly for a couple buying a house together, running a business together or planning to have children together.

Aren’t we common law husband and wife?

‘Common law marriage’ is a term often banded about but it hasn’t actually existed in UK law since 1753!

Whilst married couple have certain rights under English law, relating to finances and children, cohabiting couples do not have the same legal rights.

It’s a myth which needs setting straight so more people can prepare properly.

Separation

There isn’t the same level of legal protection for unmarried couples, and nowhere near the same level of responsibility towards each other in the event of going their separate ways. Under current law:

• If they have a family together, parents do have a financial responsibility to support their children, which is administered through the Child Maintenance Service.
• The court can also order that the non-resident parent provides a property, usually on trust, in which the children may live whilst they are dependants, but this reverts back to the other parent when the children finish school or university.
• There is no legal responsibility to provide a former partner with financial support in their own right. In the scenario where an unmarried partner may have given up their job to look after children or to support their partner in their career, they have no claim for spousal support, property or pension sharing.

If one partner in an unmarried couple dies

If you are not married, and your partner dies without a will, you will have no automatic right of inheritance. I know so many people in this situation and it frightens me for them.

Read about what happens if you die without a Will here.

Under intestacy rules – the rules which decide who benefits if someone dies without a will – an unmarried partner does not feature at all. They will not receive anything, regardless of how long they have lived together and whether they have children together.

A surviving partner can (provided they meet certain criteria) make a claim under the Inheritance (Provision for Family and Dependants) Act 1975 if their partner dies without a will or without making adequate provision for them.

The easiest way to avoid the stress of this added worry at an already sad time is to ensure that you both have a Will drawn up which look after each other in the event of your death.

Ownership of property and assets

In terms of property, each partner can keep what property and assets are in their names. Any gifts belong to the recipient; here it pays to document any large gifts for the avoidance of doubt down the track.

An unmarried partner can not claim ownership of their former partner’s property after a break up. If the house is in one partner’s name, then that person will keep the house unless the other partner can prove that there was a shared intention that they should have an interest in the house e.g. through a contribution to mortgage payments. This is often extremely difficult to prove.

I will be writing a separate post on how to approach property ownership to ensure your intentions are protected if the relationship breaks down.

In the event of the death of one partner, a home owned jointly by a cohabiting couple will usually pass automatically to the survivor. This transfer will not be affected by the intestacy rules (or the provisions of any Will). However, in this instance, the way in which the house ownership is structured is important. The house must be held as ‘joint tenants’ rather than ‘tenants in common’, in order for this automatic transfer to apply.

Property owned in the sole name of the deceased (including his share of any house owned as ‘tenants in common’) will be distributed in accordance with the intestacy rules, in the absence of a Will.

Do you need a cohabitation agreement?

For unmarried, cohabiting couples, a living together agreement, or cohabitation agreement, can provide some legal protection.

This type of legal agreement, typically drawn up by a legal professional, sets out:

• who owns what and in what proportion
• how you would split your property, its contents, personal belongings, savings and other assets should the relationship break down
• how you will support your children, over and above any legal requirements to maintain them
• sharing out of joint assets such as bank accounts, debts, and cars

This type of agreement could also be used as a framework for how you and your partner will manage your day-to-day finances while you live together, such as how much each contributes to rent or mortgage and bills, and whether you will take out life insurance on each other.

In order to be effective, both of you will need to seek independent legal advice – this avoids the situation when things have got messy where one says ‘well, he/she made me sign it’.

Doesn’t sound very romantic does it, and definitely not a first date conversation starter. But if you are taking the steps towards moving in with a partner, having children etc, it is an important conversation to have. I see it kind of like insurance – you don’t think your house is going to burn down but you still buy insurance in case it does.