Skip to main content

Tax benefits of getting married

Need pros and cons advice about tying the knot? Ask your accountant.

In our first piece in a six part series, we examine the benefits of getting married. Even though your wedding day might cost an eye-watering sum and a messy divorce can set you back by a ton of money, getting married can save you in taxes in the long run.

Despite the government refusing to announce explicit tax breaks for married couples, there are ways to work it to your advantage.

Figures from the Office for National Statistics show that the number of marriages rose by 3.7 percent in 2010. Many cohabiting households sitting on high-value properties are liable for tax charges in case a partner passes away. Those living together could miss out on thousands of pounds worth of state pensions and other benefits by not getting hitched.

Unmarried couples with property and other addresses with a combined value of more than £650,000 face an inheritance tax charge if one partner passes away. However, anything left to a spouse is exempt from the bereavement taxation. The most compelling reason to get hitched when it comes to inheritance is simply that is an unmarried partner has not made a will, the surviving partner will not automatically inherit anything at all; even if they have had children together and have been living together for several years.

 Those that are unmarried and have tried to get around this regulation by holding property as joint tenants are still subject to a 40 percent inheritance tax of the value of the deceased partner’s share.

What Investment magazine: SAVE 47%

Growth Company Investor: free trial