Inheritance tax and unmarried couple

Keep_pedalling

Pennylane said:

Keep_pedalling said:

Unlike so many unmarried couples it is great that you have wills in place, but death is not the only event that can cause you issues. Have you also put lasting powers of attorney in place? This is something all couples should do, but it is probably even more important if you are not married.

If an unmarried couple have no parents still alive and no children is it still important for them to have POA in place and, if so, why please? 

Yes absolutely, if one partner becomes mentally incapacitated through accident or illness the other partner is not going to be able to manage the finances of the incapacitated one without obtaining deputyship through the courts (an expensive and long winded process) if an LPA is not in place. 

As an example, if one partner was involved in a car accident which left them incapacitated both mentally and physically the lack of a LPA would cause major problems if it was decided the best option was to sell the existing home to buy something more suitable for their new circumstances. You might also find that medical staff would be more reluctant to involve the partner in major decisions about treatment options.

RAS

Because if your other half has a serious accident or illness, you may not be consulted about their treatment, may not be able to decide where they live if they have to go into care, and may not be able to organise a funeral.

Nor can you access their bank accounts or sort out things as basic as their phone package. No-one will speak to you as you are not the client but with a POA that's all sorted. Just get a few copies notarised so that you can send them off if suppliers/banks etc require a physical rather than scanned copy.

Brie

Oh - what about the ability to transfer tax if one person is earning under whatever the limit is (might be £11k so likely not currently relevant)

State pension - can that go to an unmarried partner?  widow/widower's benefits?  etc

Keep_pedalling

RAS said:

Because if your other half has a serious accident or illness, you may not be consulted about their treatment, may not be able to decide where they live if they have to go into care, and may not be able to organise a funeral.

Nor can you access their bank accounts or sort out things as basic as their phone package. No-one will speak to you as you are not the client but with a POA that's all sorted. Just get a few copies notarised so that you can send them off if suppliers/banks etc require a physical rather than scanned copy.

Agree, apart from the funeral bit. POA ceases on death and authority to administer the estate is down to the executors named in the will.

p00hsticks

Brie said:

Oh - what about the ability to transfer tax if one person is earning under whatever the limit is (might be £11k so likely not currently relevant)

State pension - can that go to an unmarried partner?  widow/widower's benefits?  etc

The marriage allowance, married persons allowance or (for those reaching state pension age prior to 2016) the inheritance of any additonal state pension all only apply to spouses (i.e. legally married) or civil partners.

The problem is that, with no formal arrangement in place, at what point does someone go from 'just met' through 'boyfriend/girlfriend' to 'partner'. Is it when they have had sex ? When they start living together ? when they have lived together for x number of weeks/ months/ years ? When they have joint finances ?

For benefits purposes,  DWP do consider whether two people should be regarded as a unit but it's a very tricky one to establsih in many cases....

Brie

Not saying of course that you should get married.  Just so many things are automatically understood if you are.  

onomatopoeia99

DevilsAdvocate1 said:

I think the other thing to consider is what would happen if one of you becomes seriously ill.  You might not be classed as next of kin, and other blood family, such as siblings or parents would make the decisions.

There is no legal definition of "next of kin" and they don't have any rights in law in any case.

You can nominate a "next of kin" on entry to hospital to be informed about your treatment and they do not have to be a relative, they can be a friend, partner or anything you like.  You can carry a "next of kin" card which contains this information so your wishes are known if you are unconscious.  

Further, in this day and age no NHS trust should ignore unmarried partners.  The Royal Free, for example, 
does not https://www.royalfree.nhs.uk/patients-visitors/advice-and-support/next-of-kin/


Last of all, doctors make decisions about medical treatment, not members of the public with no medical qualifications.

Pennylane

I had POA for my late Mum and it was vitally important and useful. i could not have managed without it.  

I told my friend about it and he said there was no need for him to do it for his Mum as he was a signatory on her bank account and could deal with all her financial affairs.  When she passed away he was her executor and dealt with everything he says with no problems at all.

Mojisola

Pennylane said:

I told my friend about it and he said there was no need for him to do it for his Mum as he was a signatory on her bank account and could deal with all her financial affairs. 

But that only helps with financial stuff.  I had that for my parents as an halfway house before they needed more help.

Like you, I found having POA for Dad was absolutely necessary.  Because I had it, I was able to sort out his health care and deal with the care home.

Pennylane

Mojisola said:

Pennylane said:

I told my friend about it and he said there was no need for him to do it for his Mum as he was a signatory on her bank account and could deal with all her financial affairs. 

But that only helps with financial stuff.  I had that for my parents as an halfway house before they needed more help.

Like you, I found having POA for Dad was absolutely necessary.  Because I had it, I was able to sort out his health care and deal with the care home.

I guess the difference is then that his mother wasn’t in a care home.  She lived alone at home (but had many falls and wasn’t eating properly or keeping herself clean and IMO would have been far better cared for in a care home)  and ended her final days in hospital.