Cohabitation is when two individuals live together in some form of association but are not married. There is nothing that governs the legal rights of both parties in this type of relationship, since it is not considered a legally binding relation.
Cohabitation is not a new concept, but it has become more common in recent years. There are many reasons why people choose to cohabit rather than marry, from not wanting to get married or not being ready, to not being able to afford it. But there are also some significant financial implications of cohabiting rather than marrying, which can be important for people to consider when making this decision.
What Is A Cohabitation Agreement?
A cohabitation agreement is a contract signed between two people who are living together but not married. This contract can be signed between partners of any gender and any sexual orientation, and it is a good idea for any couple before they start living together.
The main purpose of a cohabitation agreement is to outline each partner’s rights and responsibilities in the relationship, as well as to address the process by which the relationship will end. For example, a cohabitation agreement can outline how assets will be divided in case of a break-up, how much each partner will contribute to the bills, and what happens if one of you wants to move out. A cohabitation agreement can also include other details, such as who will take care of your pets if the relationship ends, distribution of the responsibility of general maintenance of shared assets, or how you will decide on where you will live.
Why Consider A Cohabitation Agreement?
Cohabitation agreements are beneficial for both parties involved in a relationship. If you live with someone, you will likely share assets, incur expenses, and make decisions that impact the relationship.
A cohabitation agreement will help you plan for the future and protect your assets. If you are in a long-term relationship, you may choose to enter a cohabitation agreement to protect you and your partner and if you have children, a cohabitation agreement may be even more important.
Where Cohabitation Is Different To Marriage
Cohabiting couples do not have the same legal protections as married couples, and are not afforded the same rights and privileges as married couples in the event of a breakup.
- In the event of a death, there are no legal rights to inheritance.
- When cohabitants open a bank account, one partner’s name will be on the account, but the other partner will have co-signing rights.
- This may incur an unfair distribution of debt within the relationship.
- Should you face financial trouble and are unable to maintain your standard lifestyle, your partner has no obligation to assist you financially.
My Rights In Cohabitation
Although cohabiting partners do not have the same legal rights as married or civilly partnered individuals there is still legislation that protects you in marriage or not.
- Partners in cohabitation are treated as spouses for in terms of their tax status.
- Donations between partners cohabiting are not subject to tax.
- If you or your partner transfer property between each other you will not need to pay transfer fees.
- If you and your partner have a child/children together but are not married, the law still requires both parents be obligated to maintain the child.
- You can still name your partner as a beneficiary in your will.
- You can still name your partner as a beneficiary on your life insurance policy.
What Is A Universal Partnership
This occurs when partners have been cohabiting and sharing responsibilities as partners in all aspects without entering an official agreement. Partners in a universal partnership may be of any gender, have any sexual orientation or may be in any type of relationship: from romantic to non-romantic, open or closed. What unites all partners in universal partnerships is their equal rights and responsibilities.
If you relationship comes to an end in a universal partnership, in order for the court to fairly award assets to each party the following must apply:
- The partnership is in place with the intention of both parties making profit.
- Both parties equally contributed to their shared pursuit.
- The partnership acted to the benefit of both partners involved.
