Around Valentine’s Day, love is very much in the air and this week, Martin Lewis added fuel to the conversation with a special episode of The Martin Lewis Money Show, focusing on the financial benefits of marriage and civil partnership.
As a well-known Solicitors firm in Sheffield, we’re often asked whether there are real financial advantages to getting married or entering a civil partnership. We wanted to offer our professional viewpoint on whether tying the knot really is “worth it” from an inheritance tax (IHT) perspective.
Martin Lewis highlighted two key rules that often take couples by surprise:
- Anything left to a spouse or civil partner is entirely exempt from Inheritance Tax.
- Any unused inheritance tax allowance can be transferred to the surviving spouse or civil partner, a perk not available to cohabiting couples.
These points sparked a lot of discussion, so let’s break down what they really mean for couples planning their future.
The Major Tax Advantages of Getting Married or Forming a Civil Partnership
Transferable Nil‑Rate Bands
Every individual has a £325,000 nil‑rate band, meaning the first £325,000 of their estate can be passed on tax‑free. If married or in a civil partnership, any portion of this allowance that isn’t used on first death can be transferred to the surviving partner.
When combined with the Residence Nil‑Rate Band (currently an additional £175,000 when passing a qualifying residence to direct descendants) a married couple can potentially shield up to £1 million from inheritance tax.
The transferable nil rate bands are not something that is available to cohabiting couples
Spouse Exemption
For couples seeking Inheritance Tax advice, one of the biggest advantages is that assets left to a spouse or civil partner are completely free from inheritance tax, whether the estate is worth £10,000 or £10 million.
Cohabiting Couples Miss Out
No matter how long you’ve been together, whether that’s 5 years, 15 years, or 50 years, if you are not married or in a civil partnership, you do not benefit from:
- The spouse exemption
- Transferable allowances
- Automatic inheritance rights
This can cause devastating tax consequences and sometimes even leaves surviving partners unable to continue living in their home.
But Even If You’re Married… Don’t Assume Your Spouse Automatically Gets Everything
Many people assume that marriage alone ensures their spouse inherits everything when they die. This is not true. Without a Will, the rules of intestacy apply, and depending on your family structure, your estate may be divided between your spouse and children.
Even if, under intestacy rules in England and Wales, your spouse ends up receiving everything, relying on that alone can still cause:
- Delays
- Family disputes
- Unintended outcomes
- Administrative complications
A well‑drafted Will eliminates doubt and ensures your wishes are followed.
How Banner Jones Solicitors Can Help
Banner Jones Solicitors provides Wills, probate, and estate planning services across Sheffield, Chesterfield, Mansfield and Dronfield
Our specialist Will experts can provide tailored advice based on your personal circumstances and professionally draft a Will that protects your wishes and your loved ones.
Our Family Law Solicitors in Sheffield, Chesterfield and Mansfield can also advise couples considering marriage or civil partnership on the legal implications because we know that while the tax advantages are compelling, the decision to marry is deeply personal and can represent a significant emotional and financial commitment.
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Pre‑Nuptial & Post‑Nuptial Agreements
If you’re concerned about the financial side of getting married, or you wish to ring‑fence certain assets (such as property owned before the relationship), a pre‑nuptial or post‑nuptial agreement may provide reassurance and clarity. Our trusted Family Law Solicitors can help prepare these agreements.
Please note: when drafting a pre‑nuptial or post‑nuptial agreement, we can only advise one party, meaning the other would have to seek independent legal advice of their own.
So… Is It Worth It?
For many couples, the inheritance tax benefits alone can equal hundreds of thousands of pounds in potential savings, as highlighted in Martin Lewis’s recent discussion.
However, marriage is a major life decision and tax shouldn’t be the only factor. Whether you’re considering tying the knot, formalising your relationship through a civil partnership, or simply wanting to make sure your estate is protected, speaking to a legal professional can help you make informed, confident choices.
If you'd like help reviewing your Will arrangements, or exploring nuptial agreements, Banner Jones Solicitors is here to guide you every step of the way.
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