Civil Partnership for heterosexual couples

A recent decision in the High Court has highlighted that heterosexual couples are being treated unfairly and discriminated against.

One couple, Rebecca Steinfeld and Charles Keidan, have recently argued this and on 27 June, the Supreme Court agreed with them.

The couple had argued that it was discriminatory for the law to deny them the right to a civil partnership where same sex couples have had that right now for some years.

One of the benefits of being either a heterosexual married couple or a same sex couple in a civil partnership is that gifts (on death or lifetime) between them are exempt for Inheritance Tax purposes.  This is not the case for heterosexual unmarried couples even though they may well be in a long established committed relationship.

It can be particularly devastating for unmarried heterosexual couples when one of them dies.  Whilst the heterosexual married couple and the same sex civil partners will be able to pass all of their assets to the survivor free of inheritance tax, this is not the case for the unmarried couple who will only have a limited exemption available.  This has the potential for leaving the survivor of them in financial difficulties.

Whilst the ruling made by the Supreme Court on 27 June may be a step in the right direction, it does not alter the law as it stands at the moment.  Depending upon the type of assets the unmarried couple own, it may be possible for lifetime inheritance tax planning to be undertaken but for an unmarried heterosexual couple anxious to ensure the survivor of them inherits everything inheritance tax free, marriage may still seem to be the best option available.

If you would like to discuss any aspect of the above article, do contact Michael Catchpole or Shauna Lines.

Inheritance Tax (IHT)

HMRC took a record £5.2 billion in IHT in 2017/18. IHT is calculated on the value of a person’s estate when they die.

It would seem however that not all estates claim the allowances that can be claimed, meaning that more tax is paid than is due.

These claimable allowances include: –

  • an individual nil-rate band allowance of £325,000;
  • a transferable nil-rate band (of up to £650,000 for a married couple);
  • the main residence nil-rate band.

In addition, in some estates, agricultural or business property relief can be claimed.

It is estimated that just 3,065 estates claimed all the available allowance resulting in unnecessary IHT being paid in other estates.

Refund of fees if you registered a Lasting or Enduring Power of Attorney

If you applied to register your power of attorney between 2013 and 2017, from 1 February this year you may be able to claim a refund of some of the fee that you paid, together with interest.

You can claim a refund if you are the donor (the person making the power of attorney) or an attorney. However, any refund will be paid to the donor.

The amount you may receive depends on the date of your application and could be between £34 and £54 plus interest for each power of attorney.

You can claim online at www.gov.uk/power-of-attorney-refund or by telephoning the Refunds Helpline on 0300 4560300 and choosing option 6. If you are an attorney making the claim, you will need the donor’s full name, address and date of birth as well as their UK bank account number and sort code.

If the donor has died, you can still claim but you must do so by phone and you will need the death certificate and grant of representation or Will.

It can take up to 12 weeks to process your claim and if approved, the refund will be made direct to the donor’s bank account.