Member Article

Love and money

As thoughts turn to romance with Valentine’s Day fast approaching, it is timely for those in long term relationships, but not yet married, to consider the financial benefits of marriage or civil partnerships says National financial planners, LEBC Group (LEBC).

While modern social moves have removed the stigma of ‘living in sin’, the taxman has yet to offer any breaks for cohabiting couples who make up three million households in the UK according to the ONS.

There are significant tax disadvantages for them compared to their married friends. These include:

Potentially paying inheritance tax (IHT) on assets inherited from each other. No right to inherit NISA allowances from each other on death, so more of any inherited savings will be taxable. No IHT free gifting of assets or inheritance of a deceased partner’s unused nil rate band, can leave the survivor and their children worse off when they inherit. No scope to share income tax allowances, especially important now we have additional tax allowances for dividend and savings income.

LEBC Director, Kay Ingram says, “Co habiting couples are at a significant tax disadvantage compared to their married counterparts. And also many married couples and civil partners do not necessarily make the most of these Government approved tax breaks.

“We urge all couples to review their finances and consider how best to arrange their financial affairs to make the most of many new tax rules introduced in the last two years. As the end of the tax year approaches, now is a good time to take stock of ownership of assets and income and to ensure that everything is as well arranged as possible. This will highlight any gaps in planning and what to do about them.”

This was posted in Bdaily's Members' News section by LEBC Group Ltd .