As well as being an important public occasion recognising your relationship, entering into a civil partnership also has important legal consequences, some good and some bad. It is not possible to consider all of these in detail, but some of the key points to consider are as follows.
For tax, you will be treated the same as a married couple. This means that you can pass assets between each other without triggering any capital gains tax. In this way you can make better use of each other's annual exemptions, saving tax when you dispose of assets which have gone up in value since you acquired them.
Be careful, though, if you have more than one property between you. Once you have a civil partnership you can only together have one house that benefits from the "principal private residence" exemption from capital gains tax. You could therefore face a tax bill on selling any other properties. With some advance planning, though, you can go some way to minimising this problem.
If one of you dies, the other can inherit assets free from inheritance tax. This opens the door to much more sophisticated inheritance tax planning than was previously available, which could enable you to save tens of thousands of pounds for the benefit of your family and friends rather than the tax man. We are experienced at preparing special tax-efficient wills that, relatively simply and cheaply, can enable significant sums of inheritance tax to be saved.
Wills and Intestacy
Once you have a civil partnership, if one of you dies without a will in place, the other will still inherit some assets (although not necessarily all of them). Before having a civil partnership, the survivor would not automatically have received anything.
Of course, it is always best to have a will in place, even if it is not a tax-efficient will. It makes dealing with your affairs much easier and quicker after your death, and also means that you can decide who receives what, rather than relying on the quirks of the legal system to decide.
Remember, though, that unless your existing will makes clear that it will continue to be effective after your civil partnership, it will automatically be revoked once you sign the civil partnership schedule. It may seem like yet another thing to worry about, but it is critical that you think about this when planning your big day.