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Government rejects law reforms for cohabiting couples

Since 1996, the number of couples living together without getting married has increased by 144%
– with 3.6 million couples cohabiting by 2021. Despite living together for years and often acquiring property and having children, unmarried cohabitants don’t have the same legal protections as people who are married or in civil partnerships.

This led the Women and Equalities Committee to call for family law reforms, publishing a report in August 2022 that proposed changes to improve financial protections for cohabitants and their children if their relationship ends.

Despite agreeing that cohabitation laws are outdated, the UK government made the controversial move of rejecting the reform proposals, stating that they need to finish reforming marriage and divorce laws before they can consider cohabitation.

Which cohabitation law reforms were rejected?

The House of Commons Women and Equalities Committee made six recommendations for updating the legal rights of unmarried cohabiting couples, but the government has rejected most of them outright. The disregarded suggestions include:

  • Reforming family law to protect cohabitants and their children against financial hardship if they separate.

The Law Commission already proposed a structure for an opt-out scheme in 2007, but this pre-dates the introduction of civil partnerships. As the government would need to base the legal rights of cohabitants on the rights of married couples or civil partners, the Ministry of Justice claims that this cannot be considered and adapted until wedding laws have been reformed.

  • Redrawing intestacy rules to recognise cohabitants if one of them dies intestate.

Again, the Law Commission put forward the idea of intestacy reform in 2011, but the government continues to reject the suggestion. This is because it could promote the interests of the cohabiting partner over their legally recognised family, including their children.

The Ministry of Justice points out that individuals are free to write wills prioritising their cohabiting partner, and that cohabitants can still make a family provision claim if they were living in the same household as the deceased on the same basis as a spouse for 2 years prior to their death.

  • Applying the same Inheritance Tax regime to cohabiting partners as married couples and civil partners.

The Treasury, being the department responsible for taxation, rejected this proposal by stating that there are no plans to extend the longstanding Inheritance Tax rules for spouses and civil partners to cohabitants. However, the government does agree that there should be better guidelines for pension schemes on how surviving cohabiting partners should be treated.

Realistically, the only accepted recommendation was to improve guidance on and public awareness of the existing rights of cohabiting couples.

What does this mean for cohabiting couples?

The lack of media attention given to the report and the government’s response is a shame, as it’s crucial for cohabiting couples to be aware of their rights.

Unfortunately, there is a popular myth that partners living together are in a ‘common law marriage’ – but there’s no such thing. Cohabitants do not have the same entitlements as married couples or civil partners in England and Wales.

Millions of people, most likely women and vulnerable members of society, are therefore left at risk of financial hardship if they separate from their partner or their partner passes away.

This is why it’s so important to make arrangements yourself if you’re in a cohabiting relationship but don’t intend to enter a marriage or civil partnership. Things you can do include:

1) Making an official Cohabitation Agreement contract that sets out your mutual plans for what happens to your joint and individual assets in the event of separation or death (including provisions for any children resulting from the relationship).

2) Drawing up a Declaration of Trust for your property to confirm the proportions that each of you own and how the value would be split if you end up selling it in the future (a formal agreement can mitigate the risk of future disagreements).

3) Each writing your own Will to confirm which of your assets should go to which named persons in the event of your death (you may want to write a joint Will, as married couples often do, but cohabitants may have a higher risk of separation).

It may not be very romantic, but taking action to set out your wishes now will be beneficial in the future – whether that’s consulting a solicitor to create your own legally binding contract, or hiring accountants in Barnsley for estate administration and probate services.