What is the difference between civil partnership and marriage?
A heterosexual couple have lost their appeal to enter into a civil partnership. Civil partnerships were introduced in 2005 by the Civil Partnership Act 2004. Same-sex marriage was introduced on 29 March 2014 in the Marriage (Same-Sex Couples) Act 2013. This gives same-sex couples two options; marriage and civil partnership, but only allows heterosexual couples one option; marriage. But, many people do not know whether there is a difference between marriage and civil partnership.
Same-sex couples entering into a civil partnership are afforded exactly the same rights as they would have had they chosen to be married instead. For example, the rules for entering into a civil partnership mirror those for marriage, as do the rules for a dissolution of a civil partnership when compared to divorce (except that adultery cannot be used as a supporting fact).
For succession planning, civil partnership also has the same advantages as marriage, particularly in terms of inheritance tax. A couple in a civil partnership can pass on death any assets they own to their civil partner free of IHT and if passed under a Will there is no limit on how much that can be. They can also take advantage of the transferable nil rate band, which allows a civil partner to claim any of their deceased civil partner's unused inheritance tax allowance on the second death. Equally, during their lifetimes, civil partners can transfer assets between each other under the same rules as married couples.
The real difference therefore is simply that only same-sex couples are permitted to enter into a civil partnership. The introduction of the Marriage (Same-Sex Couples) Act 2013 included that there would need to be a review by the Secretary of State of the operation and future of civil partnerships, but as yet, this has not happened. It is for this reason that yesterday's appeal, brought by Rebecca Steinfeld and Charles Keidan, is of such great interest.
The arguments put forward by the couple, who do not view marriage as suitable for them, reflect that they wish to formalise their relationship in a way "which is modern, which is symmetrical and that focuses on equality, which is exactly what a civil partnership is". They believe that it is not enough that civil partnerships are not available to heterosexual couples, many of whom do not believe that marriage is for them. By simply cohabiting however, they are not afforded the same rights as married couples or civil partners should they separate or one of them die.
There is no such thing as a common law marriage. If you live with your partner, but do not wish to get married and civil partnership is not available to you, then succession planning is vital. If there is no Will in place, the intestacy rules would take effect on death which currently do not make any provision for a partner. The surviving partner can therefore find themselves in financial difficulty at an already difficult time. We would therefore strongly advise anyone in this situation to make a Will to ensure their assets pass in accordance with their wishes, and to plan for any IHT that may be due. We also suggest that you look at your employer's death-in-service benefits, and any pension and life policies to see who they would pay out to on your death, and to update your scheme's nomination forms accordingly. It is common for such schemes to recognise a spouse or civil partner, but in the absence of a formal nomination, a co-habitant may again lose out.
So what did the recent judgment say?
The Court of Appeal decided that the bar on heterosexual couples entering into a civil partnership was a potential breach of human rights, but that the Court should not make any declaration of incompatibility with the couple's human rights. The reasons given for this differed. The majority of two Judges decided that although there is a difference that could be considered discriminatory, this is justified by the Secretary of State's policy of "wait and evaluate". This allows the Secretary of State more time to undertake a proper assessment as to the way forward (using the numbers of civil partnerships being entered into), including opening civil partnerships to all, or phasing them out. The minority of one Judge disagreed, and felt that the timescale of the Secretary of State was not clear enough.
Ms Steinfeld and Mr Keidan have indicated that they will appeal the judgment to the Supreme Court. It will be interesting to follow this.
For any further information on civil partnership, marriage and the rights afforded, please contact the Family or Succession and Tax teams at Blake Morgan.