What are the financial benefits of getting married?
Q My partner and I have been livingtogether for 15 years. We are very happy to be in a committed, long-term relationship. We have been told that by not getting married we lose some financial benefits. Is there really a financial case for getting wed and what difference can it really make?
A when we look through the lens of finance, it really is difficult to see why any couple in a committed, long-term, cohabiting relationship wouldn’t get married. The financial benefits range from tax-free inheritance to sharing of capital gains tax losses, sharing tax credits and, of course, the widower or widow’s pension.
Here are the four main things you may need to consider:
Taxes are definitely not romantic, but married couples can share tax bands and credits. This effectively means a spouse earning significantly more income can lower their tax.
Revenue do not recognise cohabiting couples in the same way and so do not bestow this benefit on them. Stay-at-home parents of married couples are the big winners because they can access the Home Carer Tax Credit.
The financial benefits of being married are most clear when we look at pensions, married spouses have the right to contributory pensions, and they received a widow/widower pension and the surviving civil partnership pension. The pension system does not recognise other types of relationships in this way.