Cohabitation – is it a form of modern day marriage?

The term “cohabitation” refers to couples who reside together without marrying or entering into a civil partnership and it is a concept that is on the increase in today’s society.

Although the amount of couples deciding to cohabit is on the increase, many are unaware of the legal differences between marriage and cohabitation. This has lead to the myth of the “common law spouse” where many cohabiting couples mistakenly believe that they have the same legal status as married couples and can therefore rely on the same legal rights and remedies on death and relationship breakdown. This, however, is not the case.

The main legal differences between marriage and cohabitation include;

Financial Support on Relationship Breakdown: Cohabiting couples cannot seek redress to the Court for transfers of property or maintenance payments following separation and the Court only has power to declare asset ownership. This can lead to disputes between parties as it is not always possible to state exactly who owns what when a relationship breaks down and non-property owning parties often need to rely on principles of trust law to prove their beneficial interest in a property. Matters can be further complicated if children are involved, as a home must be provided for the children of the relationship and in the absence of any agreement, the resident parent may need to seek child maintenance provision through the Child Support Agency or by making a claim under Schedule 1 of the Children Act 1989.

Property Ownership, Inheritance and Succession Rules: Survivorship does not apply to cohabiting couples and unmarried partners will not automatically be entitled to a deceased estate unless a valid Will has been made by the deceased prior to their death. If no valid Will is in place, the partner will be deemed to have died intestate and the unmarried partner will need to make a claim under the Inheritance (Provision for Family and Dependants) Act 1975 in order to be put in the same position as a bereaved spouse and recover a proportion of the deceased’s estate.

Taxation Issues: Cohabiting couples are not covered by the same tax exemptions as married couples especially in respect of Inheritance and Capital Gains Tax. For example, married couples and registered civil partners can transfer the first deceased’s party’s inheritance tax threshold to the second party in order to increase their “nil rate band” and decrease the value of the estate subject to tax. This is not applicable to cohabiting parties as they are still viewed as single persons in relation to this exemption.

Children Matters: Unmarried fathers do not automatically have Parental Responsibility of a child if they are not married to the child’s mother and need to acquire these rights through alternate methods. These methods include a) registration as the child’s Father on the birth certificate, b) entering into a Parental Responsibility Agreement with the child’s mother, c) seeking a Parental Responsibility Order from the Court.

The main problem which can affect cohabiting couples is on relationship breakdown, as neither party has a legal right to claim maintenance from the other. This can often lead to major disputes concerning property ownership and/or occupation, the division of assets and rights in relation to children of the relationship. On occasion, such disputes can result in expensive, acrimonious and protracted litigation with parties needing to seek redress to the Courts under complex statutes including the Trustees of Land and Appointment of Trustees Act 1996 and the Children Act 1989.

A cost effective and relatively simple way of limiting such disputes is for cohabiting couples to enter into a “Cohabitation Agreement”. These agreements are based on the principles of contract law and can be used by cohabiting couples to set out each party’s assets and liabilities, property ownership and child care issues, and state what would happen should one party die or the relationship ultimately breakdown. Such agreements can be tailor made to each individual couple and can often be enforced through the Courts if a dispute arises between the parties.

Due to the complexity of family set up and asset ownership, it is important that cohabiting parties and any children of the relationship are adequately provided for on death or relationship breakdown. Cohabitation Agreements can therefore be a straightforward way of providing peace of mind for those not wishing to formalise their relationship by entering into the bonds of marriage.

Blaser Mills Family Department offers a wide range of advice on family related matters and operates out of the firm’s offices at Aylesbury, High Wycombe, Harrow, Rickmansworth and Staines.

If you would like further information regarding cohabitation laws or any other family matters, please send an enquiry to confirming which office you would like to be seen and a member of the Family Department will be in contact with you.