Why estate planning is crucial for unmarried high net worth cohabiting couples 

For high net worth (HNW) individuals, estate planning is essential for preserving wealth and passing assets on tax-efficiently to the next generation. 

If you’re living with your partner but not married, you don’t have the same legal and financial rights as couples who are married or in a civil partnership. This could mean you or your partner is disinherited or faces significant inheritance tax (IHT) charges – unless you create a plan to protect each other (and any dependants you have).

There may be legislative changes ahead that give unmarried couples meaningful inheritance rights for the first time. On 5 June 2026, the government launched a landmark consultation, A Fairer End to Relationships, which includes a proposal to give qualifying cohabitants automatic rights under intestacy rules in line with the rights of spouses and civil partners.  

However, this reform is still at the post-consultation review stage, and there is no fixed timeline for when changes might become law, if they will at all. 

As such, if you’re part of an unmarried cohabiting couple, putting an estate plan in place remains a top priority. Read on to find out why and discover eight practical steps you could take now to protect your partner and your legacy.

Under current law, unmarried cohabiting couples have no automatic inheritance rights

The table below sets out the key legal and tax differences that make estate planning especially important for unmarried cohabiting couples compared to those who are married or in a civil partnership.

Why this matters for high net worth unmarried couples

For affluent unmarried couples with extensive assets – property, investments, business interests and so on – the absence of spousal reliefs might leave you or your partner with significant IHT liabilities if you have no estate plan in place. 

Moreover, intestacy rules could mean the surviving partner is disinherited entirely. This may lead to financial challenges and emotional distress at an already difficult time. 

Additionally, your wealth might pass to beneficiaries you would not have chosen. This could also create uncertainty for the next generation.

It’s also important to note that if your children and grandchildren are unmarried, they could face similar IHT hurdles in the future. 

8 practical estate planning steps for protecting your partner and your legacy

It’s never too early to start planning how to pass on your estate. Here are eight strategies to consider:

1. Create or update your wills 

A valid will gives you control over how your estate is passed on. Without one, intestacy rules could leave your unmarried partner with nothing.

Ensure you both have a will and update them periodically or if your circumstances change.

2. Register lasting powers of attorney

Lasting powers of attorney (LPAs) for financial affairs and health and wellbeing allow you and your partner to act on the other’s behalf if one of you loses capacity. This could avoid the expense and stress of court applications and financial disruption. 

3. Put life insurance in a trust

You might not be able to avoid an IHT charge on your estate altogether, but taking out life insurance could give your partner the means to cover this cost. Placing the policy in a trust keeps any payout outside of your estate, so these valuable funds can reach your partner quickly and without triggering an IHT charge.

4. Structure property ownership wisely

How you legally own your home determines how IHT is charged upon the first partner’s death. The main choice is between joint tenants and tenants in common. Which option is ‘right’ for you depends on your circumstances, tax position and legacy goals. 

5. Use available inheritance tax reliefs and exemptions

Strategic use of gifting allowances during your lifetime could reduce the value of your estate and alleviate the IHT burden on your partner. 

6. Review pension beneficiary nominations

If you want your partner to receive this valuable asset, submit an ‘expression of wish’ form to your provider and explicitly name them as the beneficiary.

7. Consider making a formal cohabitation agreement

A cohabitation agreement is a written contract for unmarried couples that covers property, finances and responsibilities while living together and upon separation.

While this document won’t override IHT rules, it ensures you both know where you stand and could reduce the likelihood of expensive legal disputes. It’s wise to seek independent legal advice to ensure the agreement is fair and enforceable.  

8. Consult your financial planner

HNW couples often have complex finances, so professional advice is essential to coordinate your estate plans as a couple. Your financial planner can use cashflow modelling to show the IHT impact of different strategies and structures, helping you make informed choices and ensure your estate plan works as intended.

We work closely with the trusts and estates team at PKF Francis Clark, so your financial, tax and trusts advice sits under one roof. This joined-up approach ensures you receive the specialist advice you need and that your estate plan aligns with your broader financial goals.

Please note

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.

All information is correct at the time of writing and is subject to change in the future.

Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

The Financial Conduct Authority does not regulate estate planning, cashflow planning, tax planning, trusts, lasting powers of attorney, or will writing.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance. 

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.