In drafting Wills for same sex couples without children, much of the considerations that apply for married persons without children will also apply in this case. That note should also be looked at in the context of this note. The advice and approach in dealing with Wills for same sex couples depends very much on the status of the relationship and the advices will depend on whether they are (a) cohabiting, (b) civil partners, or (c) married.
Cohabiting Same Sex Couples
The issues that arise for cohabiting same sex couples apply in the same manner for any other cohabiting couple. If a cohabiting same sex couple are considering Wills between either of them, they are generally in a long-term stable relationship and consideration should be given at that stage as to whether or not the couple should marry or what preparations they are making for marriage. If marriage is not a consideration, entering into a civil partnership is no longer permissible as civil partnership was an arrangement that was in place prior to the availability of marriage for same sex couples.
If for whatever reason a same sex couple may not be in a position to marry (as their partner may remain married to a former spouse), then a range of issues arise. In particular, there is a low tax threshold between the same sex couples that are not married. That means there would be a significant degree of tax cost in the event that they approach their Will drafting like a married heterosexual or same sex couple (ie. one spouse leaving their entire Estate to the other). However, payment of a significant amount of tax does not necessarily mean that the mutual wishes of the couple shall be set aside and a party should not be catered for on the death of the other.
Example
John and Tom are in a committed long term relationship but not married. John leaves his entire estate of €400,000 to Tom. As the parties are not married on John’s death Tom has a tax liability of €126,637.50. This could have been avoided if John and Tom were married.
Each party should be made aware that a tax liability could arise. There could be some facts that might assist. In particular, (a) if there are liquid assets in the Estate, (for example cash or shares) then, these funds may be used to pay any tax liability or (b) if the only asset of particular value is the family home then taxes may be reduced if the surviving party can demonstrate that “dwelling house relief” would apply.
Will drafting for Same Sex Couples, where they are Married or have entered into a Civil Partnership
As mentioned above, entering into a civil partnership is no longer permitted from the 16 November 2015. If the couple have entered into a civil partnership prior to that date or are married since then, then there are no taxes between them and they are free to leave the entirety of their Estate to the other partner without incurring any tax liability. This gives a significant degree of latitude and flexibility in Will drafting. Be that as it may, each partner to the relationship may be bringing assets to the relationship which they have accumulated independently and they may not be considered as joint matrimonial assets. It is not unusual in such a circumstance for the parties to agree between them what constitutes a matrimonial asset and what is consider a family asset and for assets to be divided between each group. Each circumstance is different and parties to the relationship may wish to leave what they consider their own assets to surviving family members and not the other partner, or they may wish to leave the entirety of the assets to the other. Each circumstance must be looked at on its own.
For more general information, please check out our Frequently Asked Questions (FAQ). This will give you some further information which applies to all wills including this case.