Here are two important and related facts for cohabiting couples: you mean no less to each other just because you are unmarried*, and there is no such thing as a ‘common law’ husband or wife.
Sadly it is often when they are grieving the loss of a partner that cohabitees discover the second fact; that and related fact number three: they have no legal right to inherit any of their partner’s own property or assets. So it is essential for people living together to think about what happens to their assets on their death, and how to provide for their partner.
There are certain steps that can be taken aside from writing a Will. Some jointly held assets pass by survivorship to the co-owner; joint bank accounts are normally treated this way. However, jointly owned property may sometimes be held in defined shares so that each owner’s share will not automatically pass to the survivor. You should ask your solicitor to check this carefully to confirm either way.
It is also possible for the proceeds of life policies and pension benefits to be nominated in favour of a partner, for example. But the correct beneficiary will only receive these proceeds if you have given formal written instructions to the life product or pension provider. You need to think carefully about that, take the right advice, and make sure you act on it.
Apart from certain joint or nominated assets, if you leave no Will the ‘intestacy rules’ will apply to everything else you own. Your assets will be divided among your relatives under a complex formula based on the size of your estate and surviving relatives. This can leave a surviving co-habitee with nothing.
If you live together and die intestate:
- Your unmarried partner receives nothing.
- Your wishes are ignored when distributing your assets.
- Some relatives you actually dislike, or have never even met, may benefit.
- You do not choose the ‘Administrator’ who will deal with your assets.
- Your children will inherit automatically when they turn 18, which you might think is too young.
- You have no control over the effects of Inheritance tax.
If you have not provided for your partner, you have left them a stark choice: to go without, or to go to Court to seek financial support out of your estate as a dependent. This could mean, for example, claiming against your own children for part of their inheritance.
We strongly recommend that everyone has a Will, regardless of their marital status. Please contact a member of our Private Wealth Team for more information and they will be happy to discuss what you need.
*Broadly, all forms of marriage and Civil Partnerships are treated equally under the law of succession of England and Wales, and for Inheritance Tax purposes. In this article we have used the words marriage, husband and wife for simplicity.