Cohabiting partners can leave home to each other but face tax limits

A cohabiting couple in Limerick can leave their home to each other through a will, but the surviving partner may face Capital Acquisitions Tax (CAT) if they are not married.

The advice notes that a will should clearly state the intention to leave the property to the partner. If no will exists, the Civil Partnership and Obligations of Cohabitants Act may provide redress, classifying the couple as cohabitees after five years of living together.

Under the Act, a surviving partner who remains in the relationship at the date of death can claim the dwelling‑house exemption without proving financial dependence, though the court must approve any redress and other family members may object.

If the partner contributes funds to renovations, she may be able to claim an equity interest proportional to her investment, which a court could consider in any relief application.

Legal experts recommend making mutual wills and, if desired, a cohabitation agreement, each party taking independent legal advice. However, courts retain discretion to overturn such agreements.

For unmarried couples, CAT treats the partner as a ‘stranger’, allowing a tax‑free inheritance of up to €20,000; any amount above that is subject to tax. The advice urges seeking specialised legal and tax counsel before proceeding with financial commitments.

Source: Limerick Post. Photo: Tima Miroshnichenko / Pexels.