In the last 50 years, the percentage of men and women who cohabit before marriage or civil partnership has increased by almost 900 percent. Today 70 percent of women aged 30 to 34 have cohabited with a male partner, and two-thirds of new marriages or civil partnerships take place between couples who have already lived together for an average of 31 months. According to the Office of National Statistics the percentage of people aged 16 or over who were cohabiting steadily increased, from 6.5 per cent in 1996 to 11.7 per cent in 2012, and the biggest increase in cohabitation is among the over 65s.
While I would not say that marriage or civil partnership is for everyone, the tax advantages of being married are significant, and the dangers of dying intestate are greatly increased if you are not married.
From a tax point of view any legacy to a married partner is exempt from inheritance tax, so however rich you are, anything you leave to your spouse cannot be taxed. On the other hand, if you are cohabiting, only the first £325000 is exempt from tax, which may sound like a lot, but over time when you have paid off your mortgage and received a legacy, can seem to be a much less generous allowance. Added to this, if you are not married to your partner and you die without a Will (intestate) there is no guarantee that your partner will inherit any of your assets. In effect an unmarried partner does not exist in law as a relative, and any legacies will fall to your nearest (but not necessarily dearest) relative – good for them, but not so good for the person you are sharing your life with.
I will deal with intestacy in a later post, but in the meantime, it is important to know that there is no guarantee that the person you are living with will inherit when you die if you don't make a Will.