Financial Focus Winter 2018 Newsletter

Getting married – doing the rights thing There are many misconceptions around the rights of the 3.3 million unmarried couple families in the UK. The government has recently announced that heterosexual couples will be able to enter into civil partnerships in England and Wales, but there will still be many unmarried couples who see no advantage in a marriage or civil partnership. However, it is worth understanding some of the laws relating to co-habitation. First, there is no such thing as a ‘common-law’ marriage. The nearest legal status, ‘irregular marriage’, only applied under Scottish law, and it was mostly abolished in 2006. This means that transfers of investments between unmarried partners could be subject to capital gains tax, which would not apply to transfers between spouses living together. Yet, at the same time, the government can treat unmarried couples as if they were married for some tax and benefit rules such as the high income child benefit charge. IN CASE OF THEWORST Some severe consequences of not marrying are revealed at the most difficult times. If an unmarried couple splits up, an ex-partner has no right to claim spousal maintenance or share of the other’s pension(s). They can only make a claim in respect of solely owned property if they can show they have made a financial contribution or have carried out repairs or improvements, which may not be the case if the non-owner stayed at home to care for children during the time they were together. If an unmarried partner dies without leaving a will, the survivor will only automatically inherit property the couple owned as joint tenants. If the surviving partner does inherit under their partner’s will – including automatic transfers of jointly owned property – they could incur inheritance tax, even if it is their home. Married couples can use the spousal exemption to transfer any unused nil rate band and residence nil rate band to reduce IHT. Surviving unmarried partners also won’t receive the state bereavement support payment, normally paid to widow(ers). A recent Supreme Court judgement questioned this practice, but as yet the rules have not changed. A different approach to financial planning may be needed if you have not married your partner. To understand what that means for you and your partner, please get in touch. B The value of tax reliefs and tax treatment depends on your individual circumstances. The Financial Conduct Authority does not regulate will writing, trusts and some forms of estate planning. Tax laws can change. 2 Winter 2018 WINTER 2018 PROTECTION iStock/Halfpoint iStock/den-belitsky Welcome to our winter newsletter, which brings you fresh news and advice on your money and investment opportunities. Our feature story this time looks at the details of the 2018 Budget, and how those headline increases play out across the rest of the tax system. Alongside that we look at the booming US stock market and the growing market for ethical and socially responsible investment funds. With recent data showing increasing life expectancy we offer some guidance on using annuities to guarantee an income in retirement. We also cover the key facts for your credit rating, and offer some tips on how to manage your data. 03 Lessons from a record bull run An international view on investments could open up new opportunities 04 Headline increases and frozen thresholds in the 2018 Budget We dive into the detail of how the Budget really affects your finances 05 Make your will the right way It is very important to make a will, and it's just as important to do it properly 06 Don't ignore your credit report With data theft becoming commonplace, you should know how to manage your credit ratings 07 Growing ethical investment for sustainable returns Ethical investment is a growing market, and it's focused on sustainable returns 08 Annuity options for long-life planning How to guarantee income in retirement, as life expectancies get ever longer In this issue... Cover image: iStock/Bridger This newsletter is for general information only and is not intended to be advice to any specific person. You are recommended to seek competent professional advice before takingor refraining from takinganyactionon thebasisof thecontentsof thispublication. Thenewsletter representsourunderstandingof lawandHMRevenue&Customspractice. © Copyright 6 November 2018. All rights reserved. SAMPLE