Many people choose to live together but not get married, but this can sometimes mean they don’t have the right to a share in their home and other assets if they separate, or if one of them passes away.
It may seem unromantic, but if you are cohabiting it’s important to be prepared for what happens if you don’t live happily ever after, and to know where you stand if your situation changes.
Here, we explain what your rights are as a cohabiting couple, and where to get more help and support.
Cohabiting and renting a property
If you and your partner are living in a rented property together, then how you set up your tenancy agreement will impact what rights and responsibilities you have. Renting is generally slightly simpler for cohabiting couples as there is no asset to be shared if you split up. However, there should be clear responsibility for rent payments and the right to stay in your property if one of you moves out.
If both your names are on the tenancy agreement
If both your names are on the tenancy agreement, you are equally responsible for the rent and any other conditions of your tenancy agreement.
If you split up and one of you wants to move out but the other wants to stay, you will need to talk to your landlord or your letting agent to change the details on the tenancy agreement. Of course, if you choose to stay in the property, it will be your responsibility to continue paying the full amount of rent.
Similarly, if one of you were to die while you were renting the property, the responsibility for the rental property would then fall to the surviving partner. However, they would probably be able to negotiate with the estate agent/landlord over terminating the tenancy agreement early if they wish, depending on the circumstances.
If just one of your names is on the tenancy agreement
If the tenancy agreement is only in one of your names, the named person can legally ask you to move out, provided they give you adequate notice.
If the person whose name was on the tenancy agreement dies, you technically do not have rights to the property, so you might be asked to leave.
However, the situation isn’t always clear-cut. You can read more in our article Your rights to a rented home during divorce, dissolution or separation.
Cohabiting and owning a property
The biggest financial asset you’re likely to own is your property and if you separate, your rights will largely depend on how it’s legally owned.
You own the property together
In this case, you will usually either own it as joint tenants or tenants in common:
Joint tenants – This means you jointly own the entire property rather than each owning a defined portion. If you and your partner split up, the ownership is split equally and if you decide to sell, the proceeds will be split 50:50. If one or both of you want to stay in the property and can’t come to an agreement, you may need to seek legal advice as you are both legally entitled to the property. If one of you dies, the surviving partner will automatically inherit the property.
Tenants in common – In this scenario, you each own a specific portion of the property, and this is what you will legally be entitled to if you split and sell up. However, things can get a little more complicated if the portions you each own have changed over time, and this isn’t legally documented. For example, you might initially have owned 25% of the property, but increased your equity over the years to 40%. It’s a good idea to get a ‘deed of trust’ drawn up as this shows exactly who owns what. If one of you were to die, the surviving partner will not automatically inherit the property unless it was left to them in their will.
If one person owns the property
If the property is solely owned by one of you, it’s their asset and in theory, they can ask you to leave if they choose. You don’t gain any rights to the property simply by living there or paying towards the bills.
However, if you pay towards the mortgage you could make a claim against your partner following a break up, based on so-called ‘implied trust’. This means that you understood that you were paying towards the mortgage in exchange for a percentage of the property. Whether a claim will be successful depends on the details, but a written agreement will always strengthen your case.
Before moving in, if you are to be paying towards bills or/and the mortgage, it’s important to consider drawing up a cohabitation agreement. This can detail anything you wish, including how much will be paid towards bills, and whether this establishes any interest in the property. It can also include what happens in the event of a split, such as notice periods, and how items bought together, such as furniture, may be divided.
If the person who owns the property dies the surviving partner won’t automatically inherit it unless it is left to them in a will.
Joint finances, investments and savings
If you have both paid into a particular savings or investment account held in joint names, you will have to work out how this money is divided if you break up. Otherwise, legally, any accounts held jointly will most likely be split 50:50, even if one of you paid more in than the other. However, debts, investments or savings held separately will continue to belong to the person listed on the account.
If you’ve paid into a savings or investment account that’s solely in your partner’s name, you might be able to legally claim a share if you separate. In this scenario, you will usually need to seek professional advice from a family law solicitor.
If you held joint investments with your partner and one of you dies, ownership will usually pass to the surviving partner.
What steps can you take to protect yourself?
While it’s less than romantic to think about the possibility of breaking up or someone dying, there are some simple steps you can take to financially protect yourself, and clearly establish your wishes:
Get it in writing – Make sure you’re clear on who owns what from the outset. This includes the property and any other assets, and how much each of you will be paying towards household bills. For property, this may involve drawing up a deed of trust to set out what percentage of the property you each own. You could also draw up a cohabitation agreement to set out what each person has brought into the relationship in terms of assets, and any financial contributions.
Write a will – As a cohabiting couple, assets will not automatically pass to your surviving partner on your death. By writing a will you can make sure to set out who will receive your property and assets on death, including your partner. Find out more in our guide The importance of writing a will.
Give yourself peace of mind that you’ll have control over what happens to your money and property when you die. A legally-binding will can ensure your wishes are followed and avoid complications for your loved ones at a very difficult time. If you’re looking for somewhere to start, we have partnered with Farewill. They have an excellent rating on Trustpilot and are offering Rest Less members a 20% discount off the cost of writing their will.
Bear in mind that If you live with your partner, but aren’t married or in a civil partnership, Inheritance Tax rules are much less generous than if you’re married. The rules for co-habiting couples are as follows:
- You each have your personal nil-rate band or inheritance tax allowance (£325,000 in the tax year 2023/24)
- You can give money or assets that you own to your partner, but they won’t be automatically exempt from inheritance tax.
If you’re married or in a civil partnership, then not only can you give away anything to your husband, wife, or civil partner without worrying about inheritance tax, but your inheritance tax allowance can be transferred to them after your death. This effectively gives married couples and those in a civil partnership much more flexibility about who they leave money and property to.
Getting legal and financial advice if you’re splitting up
The ins and outs of your rights if you are cohabiting can be confusing and if you’re separating, things can feel overwhelming, especially as emotions are likely to be running high. If you feel things are becoming too difficult or you can’t agree on something important, it can be useful to get legal or financial advice.
Where you go for advice will depend on your specific situation. If you are separating and struggling to reach an agreement, you might want to contact any of the following:
Mediator
Mediators act as an impartial party to help you and your partner sort out who will take care of the children, alongside financial matters. They won’t take sides or give you advice. Their aim is to help you both move towards an agreement and keep the situation as calm and amicable as possible.
In England or Wales you can find a mediator through the Family Mediation Council website or the National Family Mediation website. In Northern Ireland you can find someone through Family Mediation NI. For mediation in Scotland have a look at Relationships Scotland.
Solicitor
If you don’t believe that things are being dealt with fairly or you think you might have a claim against your partner, it could be worth involving a solicitor. They can help you to negotiate with your partner and draw up any necessary legal agreements. However, seeking the advice of a solicitor can be expensive.
In England or Wales have a look at the Resolution website, which is for solicitors who have committed to a non-confrontational approach to help resolve family issues. Alternatively the Law Society can offer you a wide range of solicitors in your area.n Northern Ireland you can find a solicitor through the Law Society of Northern Ireland. In Scotland, similarly to Resolution, the Family Law Association is committed to minimising confrontation during relationship breakdown. But if you would prefer a more generalised solicitor, you can find one through the Law Society of Scotland.
Accountant or financial advisor
If you and your partner’s financial situation is complicated, with a range of assets such as a business, investments and other savings to consider, it could be worth getting an accountant or a financial advisor involved.
If you live in England or Wales, you can find an accountant through the Institute of Chartered Accountants in England and Wales. In Northern Ireland, you can find an accountant through Chartered Accountants Ireland. In Scotland, you can use the Institute of Chartered Accountants in Scotland to find an accountant.
To find a financial advisor, have a look at our article How to find the right financial advisor for you. When choosing an advisor, word of mouth can be incredibly helpful and many advisors focus on building their reputation locally so it can be worth asking friends and family who they have used and if they would recommend them. If you feel uncomfortable asking others, you can also use an independent rating service such as VouchedFor or Unbiased. They have customer reviews on thousands of regulated Financial Advisors all over the country. If this is of interest, then VouchedFor also offer a Free Financial Health Check with a trusted, well-rated advisor in your local area.