Royal London: The Smart Move for Cohabiting couples

According to the 2016 census, there are over 152,000 cohabiting couples living in Ireland¹. As you know, even though a cohabiting couple live together, may own a property together and possibly have children together, in the eyes of Revenue they are treated as ‘strangers’ when it comes to inheritance tax.

Barry McCutcheon, Proposition Lead at Royal London, says,

“With a current inheritance tax threshold of €16,250 for cohabiting couples, this can result in an unexpected and unwelcome tax bill for the surviving partner, should the worst happen.

“While many cohabiting couples put mortgage protection in place to ensure the mortgage is cleared upon the death of a partner, what they may not fully understand is how Revenue will treat the inheritance of the property by the surviving partner. Who owned the property; how the mortgage protection policy was set up, including who paid the premiums, are some of the factors that can affect how much inheritance tax the surviving partner must pay.”

With this in mind, Royal London created a new guide to help support your conversations with cohabiting couples.

Barry continued,

“As you hopefully know, making it as easy as possible for you to do business is a key focus for Royal London. We will continue to provide you with excellent services, offers and tools to help facilitate your dealings with clients, which may be particularly useful during these times when face-to-face meetings aren’t always possible.

And our new guide, ‘What you need to know about Mortgage Protection and Inheritance Tax’, has been developed to help your clients, that may be ‘cohabiting’, understand the importance of seeking financial advice when arranging mortgage protection.”

Talk to your Royal London Financial Broker for more details or visit royallondon.ie/brokers to download the guide.

¹ https://www.cso.ie/en/releasesandpublications/ep/p-cp4hf/cp4hf/fmls/