Today it is very common to live as a couple without getting married or formalizing the union. However, buying a house without being in a recognized union (marriage or domestic partnership) can bring more than one legal complication. Not being formalized can have serious consequences if the relationship breaks down or one of the two dies.
In 2019, in Spain there were about 11 million couples, according to the National Institute of Statistics. However, only formalized marriages and domestic partnerships are counted in this figure. But there is one more way to live with another person without having to marry or register: the union without formalizing.
It is common for two people to decide to buy a house or have children without being married. It is one more option, although it can bring more than one legal problem in some circumstances. In this article we tell you what aspects can be a headache if you want to live as a couple without getting married or without becoming a common-law partner.
In many respects, there are no big differences. However, it does influence whether we decide to buy a house or have children. If, unfortunately, one of the members dies or the union is broken, some legal problems can occur that are avoided with the marriage.
There are five matters that will be influenced by the legal situation of people who live together: housing, taxation, life insurance, rights and children.
Buying a home is one of the most important decisions for a couple. But it is even more important in the event that they do not want to get married or become a common-law partner. What happens if one of the two owners of the house dies? What if they had children? Who can live in the house if they separate?
If one of the co-owners of the house dies without a will
Let's imagine that two people decide to live as a couple without getting married and buy a house together. What would happen to the home if one of the owners dies and does not leave a will?
When someone dies, their heirs receive not only their assets, but also their debts. Therefore, if a person has a mortgage (that is, a debt), it will pass to his heirs, just like the house (an asset).
If a person dies without leaving a will, the debts and assets of the deceased pass to his forced heirs . These are, in this order, the children (or grandchildren), the parents, the spouse and the siblings. If a person does not have any of these relatives, their assets and debts will pass to the State or, in some cases, to the autonomous community.
At this point, we find the first problem if you want to live as a couple without marrying: the surviving member is not considered a legitimate heir . Therefore, if there is no will, the couple will not have the right to inherit the part of the house that belonged to the deceased.
The importance of the will
«If the intention of that partner is for his partner to have hereditary rights, he must expressly state it in his will , and in any case the legitimate and forced heirs must be respected», explains José Gabriel Ortolá, family lawyer at Ortolá-Dinnbier Abogados de familia. In other words, it will be mandatory to make a will so that the surviving member can inherit, and always after the forced heirs (children, parents and siblings) have received their share for law.
This implies that the couple will receive the remaining part of the inheritance, but this may be less than that which would correspond to them as a widowed spouse , who is a forced heir. Also, your remaining part may be smaller than your home and therefore you may not be able to keep it. In the distribution of the will , the house can be left in the hands of the forced heirs , either the children, the parents or the siblings.
If the mortgage is in the name of both members, whoever survives will have to continue assuming their share. Whoever inherits the debt of the deceased will have to take charge of his half.
If the relationship is broken, who can stay in the house?
According to Ortolá, when a relationship breaks down, as in a marriage, the problem arises of who maintains the use of the home. In this situation, will depend a lot on whether there are minor children or not. If so, the legal criteria to be applied will be the same as in a marriage. «In the absence of an agreement between them, the use of the home is attributed to the parent to whom the judge confers custody of the minor children ,» explains the family lawyer. In this case, it does not matter who owns the property or who signs the mortgage.
However, it is not so easy when there are no children or they are of legal age:
- If only one of the members owns the home. Here, the person who is not the owner will not have the right to enjoy the house.
- If both members are members. The only solution is to agree who will enjoy the home until it can be sold or until one buys the part of the other. «If they did not agree, the judge could resolve the issue conferring the administration and use of the asset for periods until the joint ownership situation (for sale or award to one of the co-owners) », explains Ortolá.
Tax is one of the issues in which there are the most differences for marriages, common-law couples and non-formal couples. If someone decides to live as a couple without marrying, it is important that they know the tax consequences.
A couple that is not registered cannot make a joint declaration . One of its members can do it with the children, but the two members of the couple cannot do it.
Inheritance and gift tax
As we have already mentioned, only spouses (and domestic partners in some autonomous communities) are forced heirs. For tax purposes, an unregistered partner does not appear as a family, so they cannot enjoy many bonuses.
When a person receives an inheritance or a gift, he has to bear the inheritance and gift tax. For example, let's imagine that one of the two dies. The person who inherits will have to pay this fee, which is calculated according to three factors: the amount of money inherited, the degree of kinship with the deceased and the autonomous community where the deceased resided. The great difference between marriages and non-formalized couples will be in the relationship that will be recognized between the heir and the deceased.
The degrees of kinship in Spain are regulated by Law 29 / 1987, of the Inheritance and Donations Tax. They are the following:
- Group I: descendants and adoptees under 21 years.
- Group II: descendants and adopted over 21 years, spouses, parents and adopters.
- Group III: second degree collaterals (siblings) and third degree (nephews and uncles), ascendants and descendants by affinity.
- Group IV: fourth degree collaterals (cousins), more distant and strange degrees.
Relatives up to grade II have great advantages. For example, there are communities in which these relatives are exempt from 99% inheritance tax. In other words, a widowed spouse can save a lot of money when he receives the inheritance. However, if a couple was not married or recognized, the surviving member will be considered a person from group IV (stranger) and will not be eligible for this bonus .
Close to 15 million Spaniards have taken out risk life insurance, according to data from the insurance employer, Unespa. These policies are responsible for compensating the person you want if you die or have to request disability. And if you decide not to marry, you must be careful when hiring them if you want the money to go to your partner. These are the three legal problems that you may have. To avoid them, it is best to have specialized advice:
1. The couple is out of the compensation because the beneficiary has not been specified in the policy
It is not necessary to designate a beneficiary in a policy, but it is the most recommended. Sometimes, generic formulas are used that can cause a problem, such as stating that the beneficiaries will be the «legal heirs.» We must always avoid this type of formula, but even more so if we are not married and we want our partner to receive compensation.
We understand by legal heirs those who are designated in the will. If there is no will, they will be the forced heirs that we discussed above: children, parents, spouse and siblings, in that order. Thus, if they were not married, the surviving member will not be among the legal heirs .
If one of the members of the couple dies and you want the insurance to compensate the other, you must specify it in the policy, with name and surname. If generic formulas are used, it is possible that our partner is out of compensation.
2. The couple will have to pay more for inheritance tax
Life insurance is added to the total inheritance left by the deceased. Thus, at the time of receiving the inheritance, our partner will have to assume a higher tax for being a family member of grade IV instead of grade II (spouse).
3. The double capital clause cannot be contracted in the event of the death of both spouses
Some policies allow you to contract this additional clause. In the event that both members of the couple die in an accident, life insurance would pay double the money to the beneficiaries. It is an interesting option for families with children who travel a lot by car, for example.
However, as its name suggests, it covers the death of both spouses . If two people live as a couple without marrying, for legal purposes they are not spouses.
How to avoid these problems
First of all, it is very important to specify in the policy who you want your beneficiary to be. If you want your partner to receive compensation if something happens to you, specify it in the contract. Thus, there will be no problem when collecting the money. Of course, keep in mind that you will have to pay more taxes than if it were your spouse legally.
Second, do not forget that life insurance is individual: it protects only one person. If the uninsured member of the couple dies, the other will not be entitled to receive anything (regardless of whether they were married or not). For this reason, it is advisable to have two different policies: one for each. In this way, whatever happens, the family assets will be protected. Likewise, with this option you no longer need the clause in the event of the death of both spouses: each insurance would take care of its insured.
Finally, it must be considered that recognized spouses or common-law partners enjoy certain rights. If you decide to live as a couple without marrying, you will not be able to dispose of them. These are some examples highlighted by José Gabriel Ortolá:
– Adoption : only spouses and formal partners can access the adoption.
– Labor rights : unrecognized unions cannot have labor permits that involve the other member. We refer, for example, to days off due to serious illness or death of a family member.
– Leases: if a member of the marriage or formalized couple dies, the survivor has the right to keep the lease.
– Healthcare : the law recognizes that public health assists both the spouse and the formal partner of the a secured.
– Pensions: the public pension system recognizes this benefit to the deceased's partner (only for marriage or formalized domestic partnership).
– Scholarships and grants: the public system allows formalized couples and couples to have access to this type of subsidy.
As Ortolá explains, there is no legal difference between matrimonial and non-matrimonial children . The only difference will be in the judicial procedure that regulates the measures that will affect them in the event of divorce or separation. In the case of unmarried people with children, the separation is resolved with a specific procedure, but «its processing is the same,» explains the lawyer, and adds: «The criteria for assigning custody and custody of the children are identical. ”
Living as a couple without getting married or formalizing it?
As you can see, the legal union between two people can take away more than one headache. Of course, living as a couple without marrying is a valid option, but it is important to know its consequences. If you want to keep your situation without formalizing, ask the professionals for help before starting any procedure , such as taking out life insurance or signing a mortgage. Thus, you will avoid facing any of these problems or, at least, minimize their impact.