Cohabitation reform — how the Government’s proposals could affect estate planning

In June 2026, the Government launched its ‘A fairer end to relationships’ consultation, looking at how the law deals with finances when relationships end — whether through separation, divorce or death.

While much of the focus is on family law, there are some important implications for private client and estate planning that individuals — particularly cohabiting couples — should be aware of.

Here, Alexandra Williams explores the potential impact of the reforms and outlines the practical steps that you can take to prepare.

A shift towards modern family structures

The consultation recognises that family life has changed significantly over the past few decades, with cohabiting couples now one of the fastest‑growing family types. Yet, the law hasn’t kept pace.

Many people are surprised to learn that there’s no such thing as a ‘common law marriage’. In fact, cohabiting partners have very limited legal rights if a relationship ends or a partner dies, leading to hardship for many — particularly those who are most vulnerable.

The proposed reforms aim to address this gap while still maintaining a distinction between marriage and cohabitation.

Potential new rights for cohabiting couples

One of the key proposals is the introduction of a new legal framework for cohabitants on separation.

In broad terms, qualifying cohabitants (for example, those who’ve lived together for a certain period or have children) may be able to bring financial claims, although they’d be more limited than those available on divorce. The starting point would remain that each person retains what they legally own. As in divorce cases, children’s needs would come first.

The proposed framework isn’t without debate. Many couples choose to cohabit rather than marry — specifically to maintain financial independence — and may not expect legal obligations to arise. To address this, the Government is proposing an ‘opt-out’ model where cohabitants can mutually choose to exclude themselves from the protections. This may be particularly appropriate where, for example, an older couple has children from previous relationships and wish to pass their separate assets on independently.

A possible change to intestacy rules

From a private client perspective, the most significant development is the proposal to reform the law affecting cohabitants on death.

At present, a cohabitant has:

• No automatic right to inherit if their partner dies without a Will. Instead, they must bring a claim under the Inheritance (Provision for Family and Dependants) Act 1975.
• No standing to apply for a Grant of Administration, creating difficulties where responsibility passes instead to relatives who may have had limited involvement in the deceased’s affairs.

The consultation seeks views on introducing intestacy rights for cohabitants — equal to those of spouses or civil partners — for relationships of marriage-equivalence, aligning them with the framework governing claims for reasonable financial provision under the Inheritance Act.

If implemented, this could significantly change how estates are distributed and administered where there’s no Will and may lead to greater complexity and potential for disputes, particularly in blended families.

A note on inheritance tax

It’s worth noting that the consultation doesn’t propose any changes to inheritance tax (IHT), meaning that even if cohabitants gain greater rights on death, their tax position would remain very different from that of married couples.

In particular:

• Transfers between spouses and civil partners (both during lifetime and on death) are generally exempt from IHT and unused allowances can be transferred to the survivor.
• By contrast, cohabiting partners don’t benefit from these reliefs, so assets passing on death may still be taxed at up to 40% above the available thresholds and there’s no ability to transfer unused allowances.

In practice, this means that — even if the law changes to give cohabitants a greater right to inherit — the overall outcome may still be significantly less favourable from a tax perspective. 

A reminder: marriage & existing Wills

Another point worth highlighting is that marriage or civil partnership automatically revokes an existing Will (unless the Will was expressly made in contemplation of that marriage).

Many couples put Wills in place while cohabiting, often long before they go on to marry or form a civil partnership. Under current law, those Wills can be invalidated by their subsequent marriage, frequently without the couple realising. This leaves the estate to pass under intestacy rules unless a new Will is put in place.

The consultation doesn’t propose any change to this default position. However, a 2025 report by the Law Commission — still under consideration by the Government — recommended abolishing the automatic revocation rule, so this remains an area where reform may still follow.

Greater emphasis on planning ahead

Alongside cohabitation reform, the Government is also considering changes to financial arrangements on divorce, including making certain pre- and post-nuptial agreements legally binding in appropriate circumstances. 

Taken together, these reforms point towards a greater emphasis on certainty, autonomy and planning ahead.

What does this mean in practice?

While the consultation is at an early stage, it highlights the importance of individuals taking proactive steps now:

1. Make a Will — particularly important for cohabiting couples as the current law provides no automatic protection on marriage or civil partnership and where individuals have specific and/or complex wishes for their estate.
2. Review existing arrangements — especially where there are second families or unmarried partners.
3. Consider cohabitation or nuptial agreements — to provide certainty as to how assets should be treated.
4. Take advice early — to ensure that your estate planning reflects both current law and potential future changes.

Looking ahead

These proposals reflect a shift towards recognising how people actually live their lives — particularly where couples choose not to marry — but without placing cohabitation on the same footing as marriage.

For private client advisers and their clients, the message is that taking advice and putting clear arrangements in place remains essential.

Talk to us

Our award-winning private client team advises individuals, families and business owners on the full spectrum of estate planning and personal legal matters, including helping clients to navigate the complex intersection between relationship law and succession planning.

We regularly support clients to structure their affairs in a way that protects their interests and reflects their wishes. Our work spans Wills, trusts, probate, contentious estates, tax planning, wealth management, residential property and family‑related issues that impact long‑term planning.

If you’d like to discuss how these proposals may affect your estate planning, talk to us by giving us a call on 0333 004 4488, sending us an email at privateclient@brabners.com or completing our contact form.