'I am a common law spouse' is the frequent misconception shared by many couples living together without any marriage or civil partnership status.
But the reality is far from the truth, with cohabiting couples sharing almost no legal rights should a relationship break up, compared with those protected by civil partnerships or through the virtue of the ‘m’ word.
This problem cannot be neglected, not least because cohabitees are on the rise across the UK.
Data released by the Office for National Statistics in August 2019 show the number of people cohabiting in the UK has risen by 25.8 per cent in the past 10 years, making it the fastest-growing family type in the UK.
To add to this, the number of same-sex couple families has more than doubled since 2015.
This growth trajectory is not the same for marriages, which have declined in the same period, although it is still the most common family type in the UK.
So what are the financial implications of not being married versus those of having tied the knot?
Common law spouse
Matrimonial consultant, Sheela Mackintosh-Stewart, founder of ifamiliesUK, says many cohabitees are under the false impression they are common law spouses, with the same guaranteed protections and financial and legal rights as married couples.
In fact, figures from the National Centre for Social Research reveal almost half mistakenly believe the myth.
This concern is echoed by several others in the industry.
- Those who are cohabiting do not have the same rights over property as those that are married
- It is very difficult to make a claim on assets if they split up
- Cohabitees are also not exempt from inheritance tax if one partner dies
Hannah Saxe, senior associate at Irwin Mitchell, says: “There is a common misunderstanding that someone can be in a common law marriage with their partner if they have been in an unmarried relationship for a long time.”
The main reason unmarried couples who have not opted for a civil partnership are at threat of being financially unprotected relates to the fact they are unable to make financial claims should their relationship break down.
Ms Saxe adds: “It does not matter how long a couple have been together, if they are not legally married or in a civil partnership they will find it very difficult to make claims against each other’s assets if they split up.”
She adds that cohabitees have no basis upon which to apply for maintenance from their partner (apart from claims for the benefit of their children).
Transfer of assets
So how does transfer of assets such as property work under both marriage and cohabitation?
Ms Saxe says unmarried couples are only able to make financial claims for themselves in relation to a property, such as their family home, if they can establish they have an interest in it.
Ms Mackintosh-Stewart confirms: “Unmarried couples have no guaranteed rights to ownership of each other’s property on break-up, unless they can successfully show evidence of financial contribution, a written agreement or trust deeds that clearly set out the share of legal ownership of the property and financial contributions.”
Ms Mackintosh-Stewart explains that spouses and cohabitees who are disinherited from the deceased spouse or partner’s will can launch a challenge on grounds of invalidity or that they have been financially provided for.