When it comes to inheritance and estate planning, the law treats unmarried couples differently than married spouses. It is important for unmarried couples to think about estate planning in order to protect their assets and to prevent any financial surprises or setbacks for their partner after they die.

Common-Law

In Canada, unmarried couples are also known as common-law couples, common-law spouses or common-law partners. Each province has their own legal definition of what common-law means. In Ontario, common-law is defined as partners who have been continuously living together in a conjugal relationship (meaning sharing a home, finances, friends, etc.) for at least three years (the term is less if there is a child, either by birth or adoption).

For tax purposes, common-law means persons who are the parents of the same child (biological or adopted), have cohabitated in a conjugal relationship for at least 12 continuous months; or have cohabitated in a conjugal relationship previously for at least 12 continuous months, separated for less than 90 days and then resumed cohabitation (more than 90 days may affect the status of being common-law).

Common-Law Couples Without a Will

As mentioned earlier, common-law couples are treated differently than couples who are legally married. When a married spouse dies without a will, the remaining spouse is entailed to inherit a preferential share, currently $350,000 in Ontario, and distributive share (percentage depends on number of children alive) of the decedent's estate and is entitled to the possession of the matrimonial home. A married spouse is also entitled to make an equalization claim, which is one half of the value the property accumulated over the marriage, instead of a preferential and distributive share claim if they so choose.

This is not the case for common-law spouses. If you do not have a will at the time of your death, a common-law spouse has no legal right to any of your assets, has no claim for a preferential share or distributive share of your estate, or an equalization claim. The surviving common-law spouse has no property rights either, unless you were both legal owners of the property or the surviving spouse contributed to the value or acquisition of the property or any other asset you owned for that matter, the surviving common-law spouse has no claim to possession or financial compensation.

Connect With Suzanne Desrosiers Professional Corporation

Whether you are a married couple or a common-law couple, it is vital to have a will to ensure your assets are protected and distributed in the manner you wish. If you have any questions about creating a will or other estate related inquiries, please feel free to reach out to Suzanne Desrosiers Professional Corporation by calling us at (705) 268-6492 or emailing us at info@sdlawtimmins.com and we would be more than happy to help!