The law around the separation of married and cohabiting couples in England and Wales is being reviewed and if the reforms are adopted, would be the most significant development for decades. The government has launched a consultation that could, for the first time, provide cohabiting couples with meaningful, needs-based financial remedies. The reforms would also impact divorcing couples by clarifying principles in legislation, making the law clearer, more consistent and more accessible.  Changes are also proposed to the law for cohabiting couples on intestacy.

Proposed reforms to divorce

• To codify marital and non-marital property
• The starting point is equality for marital property unless unequal division is required to meet “needs”
• 3 stages of consideration– the child’s welfare, the individual’s capital and income needs, any further discretionary needs where resources permit
• Remedies available will remain the same as now, including property adjustment orders, lump sums, pension orders and maintenance.
• The Overarching objective will be to achieve a fair outcome
• Compensation will not form part of the Overarching objective
• Will build on the current Section 25 factors with additional checklist re “needs”
• Non-marital property can be shared where marital property is insufficient to meet needs
• To codify “matrimonialisation” and provide a checklist to establish if this has taken place
• Needs of both should be met to enable transition to independence for both parties
• Discretionary needs can be considered such as lifestyle/luxuries/standard of living, but these will be secondary to essential requirements
• Needs outside of the relationship will be considered, including where there is illness or disability needs
• Section 25 factors will include relationship disadvantage, such as giving up a career to care for children
• Domestic abuse will be more fully considered and may revise “obvious and gross” definitions in relation to conduct – could lead to fact-finding hearings within financial remedy cases
• Impose statutory obligation re consideration of pensions
• Qualifying nuptial agreements (pre-nuptial and post-nuptial) could be binding if set criteria are followed – however no such agreement can allow individuals to contract out of meeting each other’s financial needs – a checklist will be prepared
• If challenged, “needs” will be assessed more narrowly where a nuptial agreement is in place and discretionary needs will not be considered.
• There will be no change to there being no time limit for making marital claims

Proposed reforms for cohabiting couples

• To protect children and vulnerable persons, including against domestic abuse
• Parties must live together for 3 years in a relationship OR live together and have a child, including a “child of the family” (no time limit). A checklist will be prepared
• Parties must be 18 years of age
• The length of the relationship will be a factor
• Claims must be brought within 2 years of separation. If not, parties can still use existing remedies such as the Trust of Land Act.
• Parties can opt out by entering into a Deed but there will be defined ways to do so in order to avoid coercion or mistake
• Each party keeps what they own, but the Court can depart from this where it is required to meet “needs”. The determinative factor will be “needs”, with the welfare of the children as the first consideration.
• The overarching objective will be to achieve a fair outcome as with married couples
• Court will consider housing, capital, income and pensions along with standard of living and how the needs should be met in line with the resources available.
• No default as to an equal sharing of assets
• “Needs” will be defined more narrowly than on divorce, and do not include discretionary needs
• Checklist of factors likely to include earning capacity, financial resources of each individual, any physical or mental disability, age and length of relationship and compensation i.e., relationship-generated loss.
• Conduct to be considered as with married couples and more focus on economic abuse
• Not entitled to a more favourable outcome than married people
• The parties should work towards a clean break
• New remedies would be available, including Property adjustment orders, lump sums and pension sharing orders. Also, maintenance orders, but in exceptional circumstances only, such as serious disability and would be time-limited (no joint lives orders).
• The Family Court would hear disputes, not the Civil Court
• Qualifying couples should not use other remedies such as the Trust of Land Act
• If couples do not qualify as a cohabiting couple or 2 years has passed without a claim being made, parties can use the Trust of Land Act (6 years’ time limit if not a joint property)

Timescale for possible reform

The consultation will end on 14th August 2026. There is no guarantee that the changes will be made. If the proposals are passed into law, it could be 2027 or 2028 before the changes come into force. 

What you should do now

• Consider a cohabitation agreement. This will set out how finances are to be dealt with after any separation. This can save costs and avoid court proceedings and emotional distress.
• Review how your property is held. Do you own the property as joint tenants or tenants in common? Is a declaration of trust required?
• Make a will. This will ensure that your wishes are carried out.
• Take advice in relation to the existing routes available on separation.
• Consider a pre-nuptial agreement. This will set out how finances and assets will be shared in the event of a divorce.

How can Taylor Bracewell help?

If you wish to make a cohabitation agreement or pre-nuptial agreement, you can contact our family solicitors on 01302 341414 or 0114 272 1884. If you wish to make a will you can also contact our probate solicitors on the above numbers. Alternatively, you can fill out our online enquiry form.