We've come a long way, but inheritance tax still exists!


In 2003, Essex Pride was established, and how far the law has come even since then! It is now illegal to discriminate against LGBTQ+ people in the workplace under the Employment Equality (Sexual Orientation) Regulations. Same-sex couples undergoing fertility treatment have gained the right to name both partners on the birth certificate. The Marriage (Same-Sex Couples) Act was passed in 2013 in England and Wales.

Thankfully, the world of will drafting has been ahead of the curve. The introduction of the Civil Partnership Act amends all legislation governing wills, administration of estates and family provisions to provide that civil partners are treated equally as spouses. The drafters of the Marriage Act ensured that if you elect to convert your civil partnership into a marriage then your will is not revoked. This means you wouldn’t have to pay to make a new will and could instead put this money towards the festivities!

This means that whether you are in a marriage or civil partnership you are able to leave your estate to each other without paying Inheritance Tax. You can also transfer any of your unused nil-rate band for them to apply to use against their estate when they die. Depending on the terms of your will, your partner could also utilise your Residential Nil Rate Band, an extra tax allowance of £150,000 (tax year 2019/20).

However, the position for cohabitees and unmarried couples remains the same in both heterosexual and same-sex relationships. If you are not married or in a civil partnership, your partner will receive nothing without bringing a claim against your estate. This situation can be changed by naming them as a beneficiary under a valid will.

Sadly the rules of intestacy have not adapted with modern times and still do not include cohabitees and unmarried partners. Aside from the emotional impact that these provisions can have, it could also lead to significant financial implications. Legal fees will be incurred in making a claim against your estate and inheritance tax planning opportunities might be lost.

It is also important to remember that unless you are married or in a civil partnership, your partner is not considered as your next of kin.

It is a common misconception that someone will be able to speak on behalf of their incapacitated partner to doctors at critical times. Without being appointed as an attorney under a registered health and welfare lasting power of attorney, they do not have the authority. Similarly, without being appointed as a property and financial affairs attorney, your partner will not be able to access your sole bank accounts to assist you in your time of need.

As I say, we have come a long way and there is much to be celebrated as we go into the future. However, as the last 16 years has proven, a lot can change in a short amount of time! It is important for you, regardless of your sexuality, to make a valid will and lasting powers of attorney. These can ensure that your partner will be able to help you in your time of need and be provided for when you die.

Our specialist wills solicitors guide you through the process of making a will or drafting a lasting power or attorney. They help ensure your loved ones are provided for in the way you wish and that you have someone you trust dealing with your affairs if you can’t.

If you would like to discuss will drafting or making lasting powers of attorney, please do not hesitate to contact me for a free, no obligation 15 minute chat. I am based in our Chelmsford office and can be contacted on 01245 453849 or lisa.cox@birkettlong.co.uk.

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.