It is currently believed that there are over 3.6 million co-habiting families in England and Wales with this number increasing each year.
Cohabiting couples have very limited rights under the current law, and this can leave the more financially vulnerable out of the two in a very difficult situation on the breakdown of the relationship. As a result of this, the House of Commons Women and Equalities Committee have been campaigning for a reform of the law surrounding this in order to abolish the ‘common law marriage’ myth and provide protection to those who need it.
However, the Government have recently rejected these recommendations and have explained that the current work around marriage and divorce law must be completed before changes in the law concerning the rights of cohabitants on relationship breakdown are considered.
Despite this, there is still a need for cohabiting couples to have the means to rebuild their lives on the breakdown of a relationship and for them to have a fairer division of assets and finances very similar to that when dealing with financial remedies on divorce. As a result, there is the option for cohabitants to agree and sign a co-habitation agreement. This will set out how they share their finances whilst living together and what will happen if one of them is to become ill, die, or the relationship ends.
What should the agreement cover?
- How household bills should be paid e.g., rent, mortgage etc
- What will happen with the finances e.g., joint bank accounts, pensions etc
- What will happen with property and assets either owned beforehand or obtained whilst living together
- Arrangements for children if applicable
What information is needed from you?
- Proof of assets and finances e.g., savings, pensions etc
- Tenancy agreement/ title deeds
- Proof of earnings using payslips and bank statements
- Birth certificates of children if applicable
For the agreement to become valid both parties need to enter into it freely and voluntarily, it needs to be in the form of a deed, each party needs to sign it and ensure that it is kept up to date for all major life changes.
It is also advisable that each party to the agreement should seek independent legal advice in order to ensure that they understand what they are signing and that they are happy with it.
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Article by Heidi Kavanagh – Paralegal