Facebook Twitter LinkedIn Google Plus YouTube

Finding Tailored Financial Advice for the LGBT Community

Charitable | Articles | Advisers

spinner

Civil Partnerships

While equal marriage has finally been allowed in England, with Scotland and Wales following soon, many LGBT people are still in Civil Partnerships. What are the differences between being in a Civil Partnership and living together? Below we run through some of the common questions and scenarios.

 

LIVING TOGETHER

 

CIVIL PARTNERSHIP

CREDIT CARD /
PERSONAL LOAN

You are liable for any credit card in your name, even if a partner is a named user.

If a card is held jointly then you are both liable.

You are liable for any credit card in your name, even if a partner is a named user.

If a card is held jointly then you are both liable.

If a civil partner has debts in his or her name, you will not be responsible for them.

HOUSING

If you’re living together in rented accommodation one or more of you may be tenants.  If you aren’t named on a tenancy then you normally won’t have any rights to stay there.

If your partner is the sole owner you may not have any rights to stay if she or he requests that you leave.

 

If you are civil partners, you both have the right to stay in your home, regardless of who owns the property or whose name is on the mortgage.

Homes can be owned either as joint tenants or tenants in common. Joint tenancy means that the share of the property will pass automatically to the other person on death; tenancy in common means that each partner owns half the property and can therefore will it to whomever they choose.

If your relationship breaks down and there are children, the court can transfer the property as part of an ultimate settlement, usually at least until the children are 18.

BANKING

Living together, you will never have access to each other’s bank accounts, even if one of you dies.

If you have a joint account and one of you dies,most often the surviving partner will wholly own that account.

If one of you dies, the surviving partner may well be permitted by the bank to draw money from a deceased’s personal account, especially if the amount is small.

Debts and overdrafts in joint accounts are the responsibility of you both regardless of who puts the money in.

 

TAX

If you live together this will make no difference as to how you’re both taxed.

Working Tax Credit and Child Tax Credit are available whether married, civil partnered or not.

Civil partners have exemptions from Capital Gains Tax and Inheritance Tax.

You can transfer assets between you without paying Capital Gains Tax. In the event of a death, the deceased's estate can pass to the surviving partner without inheritance tax.

 

LEGAL STANDING

You can write a document called a Living Together Agreement or Cohabitation Document, which will be recognised by the courts, though you are advised to seek the help of an experienced lawyer to draw up this document.

However, you may not be able to make your partner comply with it later.

This document could be about a shared responsibility such as custody or maintenance of children, ownership of property, or jointly owned assets.

 

As a civil partner you obtain tax exemptions,  the ability to get parental responsibility for a partner’s children, tenancy rights, life insurance recognition, next of kin rights in hospitals,  as well as the responsibility for the reasonable maintenance of your partner and their children

PENSIONS

Some pension schemes will offer benefits to a dependant partner, but not all so do check.

If any scheme offers benefits to opposite-sex partners it should offer them to same-sex partners.

If you split up, you have no automatic right to your partner’s pension.

 

If your civil partnership ends in court, you are entitled to a share in your partner’s occupational and private pension.

If one of you dies, the surviving partner may well be entitled to a share in the deceased’s occupational or private pension.

It’s against the law for an occupational pension scheme not to offer the same benefits to a civil partner as a married partner.

STATE PENSION

As a living together partner, you can’t claim a state pension based on your partner’s NI contributions.

As a civil partner, you may able to claim your partner’s state pension, although this is one area where discrimination still exists..

BENEFITS

If you are living together as a couple, your finances will assessed  jointly when it comes to tax credits and child benefit.

If your partner dies, you cannot claim for bereavement benefits.

You can claim for bereavement benefits or sometimes your civil partner’s pension, if your civil partner dies.

 

JOINTLY ADOPT
A CHILD

 

Yes

 

Yes

 

 

INHERITANCE TAX EXEMPTION

No.
Anything above £325,000 which your partner leaves to you in their will will be taxed at 40%.

 

 

Yes.
Regardless of the size of their estate, your partner can pass this to you without incurring a tax liability.

 

 

HOUSEKEEPING

If you give your partner housekeeping money any property bought with savings from it will probably belong to you, and a court will likely decide in this way.

On the breakup of a relationship, a court will generally decide that savings from housekeeping money be equally divided between both partners.

GIFTS

An item will be deemed to be owned jointly if it is bought from a joint account.

If you give something to your partner it will belong to them, but this can be very difficult to legally prove.

If you bought something together but your contributions were unequal, then your share will be equivalent to your contribution.

 

Any property owned by you or your partner is considered joint property and will be taken into account if a settlement is sought after a relationship breakdown.

 

 

ENDING A
RELATIONSHIP

If you’re living together you can end your relationship without going to court.

However a court can still decide who may take care of any children.

If you are unable to sort things out by yourselves it is best to appoint a mediation service. 

If you’re getting a legal separation or dissolving a civil partnership, the court will first consider the arrangements to be made for any children.

A civil partnership needs to be at least a year old before it can be legally dissolved.

It can be a lot easier dissolving a civil partnership as there are recognised legal structures for sorting things out.

IMMIGRATION

If one partner lives in the UK you both must prove that you have been in a relationship akin to civil partnership for two years or more.

If both partners live outside the UK you both must prove that you have been in a relationship akin to civil partnership for four years or more.  Both must demonstrate sufficient knowledge of English as well as knowledge about life in Britain

If a couple are civil partnered the authorities will treat an application more favourably.

It is likely however that any couple will be required to live together in the UK, not be a burden on public funds, and there will be likely be a condition that a couple or individual will be deported if a civil partnership (as with a marriage) is dissolved quickly, suggesting that it may not have been genuine to begin with.

WILLS

Couples who are not civil partnered cannot inherit from each other without a will.

Further, if your living together partner is not named as the executor in your will, they will not be the one who sorts out the deceased’s estate.

Without a will, surviving partners only have one recourse if they feel an entitlement has been overlooked, and that is to make a claim under the Inheritance Act of 1975.

It is always a good idea to make a will, but especially so if you own property together.

With a will, full inheritance is more straightforward when you are civil partnered.

Further, on the death of a partner, the surviving partner will pay no Inheritance Tax on assets or money received, even if it is over £325,000.

It is always a good idea to make a will, but especially so if you own property together.

Without a will, your estate will not automatically pass entirely to your Civil Partner, but will distribute your assets throughout your wider family as well as your Civil Partner.

The Law of Intestacy differs slightly in England and in Scotland.

HEALTH AND
SICKNESS

If you are not civil partnered, a hospital may not automatically accept your involvement in the affairs of a partner, no matter how long the relationship.

It is very likely a hospital will automatically recognise the input of a civil partner in medical care.

However, even if you are too ill to give your consent for a medical procedure, the law states that nobody can give consent on your behalf.

 

Additional Reading

Latest Finance Articles

Latest Articles

© Copyright LGBT Finance Limited, 10 Melville St. Edinburgh, EH3 7NS