Marriage

Cohabitation

Tax

Transfers of assets between husband and wife are exempt from capital gains tax and inheritance tax.

There is no capital gains tax or inheritance tax exemption for transfers between unmarried cohabitants.

Pensions

In general, a spouse is entitled to inherit a deceased spouse’s pension rights (although the details can vary with different pension providers).

An unmarried cohabitant generally will have no right to inherit pension rights on the death of the other partner.

Registration of Birth of a Child

If the mother and father of a child are married at the time of birth, either of them can register the birth.

If a couple if not married when their child is born, the mother has sole responsibility for registering the birth of the child.

If the unmarried father is not present at the time of registration, his name will not appear on the birth certificate and he will not have responsibility for the child – but there are procedures the couple can use to get the father on the birth certificate.

In addition, new law that is to take effect in January 2011 will encourage both unmarried parents to register the birth of their child, and should make it simpler for them to do so.

In Scotland, it is relatively straightforward for unmarried parents to register a birth (such that they both get parental rights and responsibilities).

Registration of a Death

A married person can register the death of his or her spouse.

An unmarried person cannot register the death of a person with whom he or she has cohabited.

Inheritance

If one partner in a marriage dies without a will, the law of intestate succession provides that a part of the deceased’s assets go to the surviving spouse.

If a partner dies with a will, that person’s assets will pass in accordance with the terms of a will.

If a cohabiting partner dies without a will, the surviving partner has no automatic right to any of the deceased’s assets – although there are procedures whereby certain cohabitant’s can make a claim for part of the assets of a deceased’s partner’s estate.

If a partner dies with a will, that person’s assets will pass in accordance with the terms of a will.

Separation / Termination of Relationship

When a marriage comes to an end, the division of marital assets is governed by matrimonial law.

If the parties have entered into an agreement (after getting married) that specifies how their assets should be split on divorce or separation, the court will probably take the agreement into account.

If the parties entered into a pre-nuptial agreement, the court may not take the agreement into account at all – or only to a limited extent; the general rule in England and Wales is that such agreements are not enforceable, but in some recent cases the courts have taken them into account. The law in this area should be clarified by the Supreme Court in the summer of 2010.

Unless the parties have entered into a cohabitation agreement, there will, in effect, be no legal apparatus that governs the end of the relationship. It will be down to the parties themselves to work things out.

If the parties have an enforceable cohabitation agreement, then in general their assets should be divided in accordance with the agreement.

In Scotland, a cohabiting partner whose financial position has been disadvantaged as a result of decisions taken by the couple while cohabiting (for instance, that one should stay home and look after children) can ask the court to take that into account in settling financial arrangements after the relationship has ended.

Buying a property

Ordinarily, married couples will buy as joint tenants with right of survivorship; neither party has a separately identifiable share of the property – they own it jointly; if one spouse dies, the other spouse becomes sole owner of the entire property.

A married couple may also buy as tenants in common, with a separate share in the property allocated to each person. Typically, couples opt for this choice where one spouse has children from a prior relationship. If one spouse dies, his or her interest in the property does not pass automatically to the other spouse. Instead, the deceased’s will determines who takes the interest or if they don’t write a will, the interest is distributed in accordance with the laws of intestacy.

A cohabiting couple can buy as joint tenants; typically, though, it is a good idea for a cohabiting couple to have a cohabitation agreement governing the way they hold the property (how they share upkeep costs, financing costs, etc) and what happens when one partner dies.

A co-habiting couple might instead choose to buy as tenants in common, with a separate share in the property allocated to each person (which would pass to that person’s beneficiaries on his or her death).

Getting a mortgage

A married couple will typically get a mortgage together, and it will be a joint and several obligation.

Mortgage lenders will often lend to cohabiting couples in the same manner as a married couple – on the basis that they will be jointly and severally liable on the mortgage (which means that if one person defaults, the other remains liable for the entire debt).

Property – Ownership Interest / Interest on Sale

If a married couple hold a property as joint tenants, each will have a legal (registered) interest in the property and a right to a share in the proceeds on sale.

If only one person in the marriage is the registered owner of the property, the other spouse will have an interest in the property (i) under matrimonial law, and (ii) by way of beneficial interest – this could be limited, however, if the property is not regarded as marital property and the spouse who does not have legal title cannot establish a beneficial interest.

Scottish property law applies to property ownership by a married couple, but the position is broadly similar to that in England.

A cohabiting partner who does not have occupancy rights can apply to the court for the right to occupy. Although legally different, the effect of this is similar to a beneficial interest in England and Wales.

If a cohabiting couple hold a property as joint tenants, each will have a legal (registered) interest in the property and a right to a share in the proceeds on sale.

If only one person in a cohabiting couple is the registered owner of the property, the only interest of the other partner will be a beneficial interest – if it can be established.

In Scotland, a cohabiting partner who does not have occupancy rights can apply to the court for the right to occupy. Although legally different, the effect of this is similar to a beneficial interest in England and Wales.

Benefits

Benefits such as universal child benefit, working tax credit and child tax credit do not depend on marital status.

As for a married couple.

Child Support

Both parents are legally responsible for child support, regardless of marital status.

As for a married couple.

Immigration

Where a marriage is genuine, it is usually possible for a non-British spouse to obtain permission to reside in the UK (provisionally for a period, and then permanently).

If a couple have been living in a relationship akin to marriage for two years or more, they will likely be treated in a manner similar to a married couple for immigration purposes.