The devil is in the detail for family law

Following on from our previous episode with Mo Pasricha from Mackrell, in this episode we are join again by Mo and Manisha Hurchurn from Mackrell, to discuss the importance of family law issues.

[2.29] Co-habitation agreements

Scenario: A professional athlete is considering moving their partner into their property. They potentially could be earning millions, own a big house, could be mortgage free. They think everything is fine and will remain the same when they move their partner into the property.

This may not the case. This scenario is suggesting to the partner; this is your home, this is as much of yours as it is mine, you can do what ever you want here, this is 50/50, it’s my name on the legal deeds etc. If the relationship takes breaksdown, this could lead in giving the partner an interest in the property.

It would be very wise to seek advice on entering into a co-habitation agreement. You would be recording your intentions of moving in together. Intentions can be very broad or specific to what this contains such as, you can bring pets into the house, no legal right to the property on the breakdown of the relationship etc. There are different rights for co-habiting couple verse a married couple.

[10.32] If relationship breaks down with children involved

Child maintenance service to regulate payments based on gross income. There is a cap of gross annual income of £156k per annum, that is the total amount the CMS (Child Maintenance Service) will look at. If the footballer is earning a significant amount, on top of the CMS calculation, the mother can go through the family courts to get a top up of child maintenance which can be very significant. Included in that application, mother can also ask for a car, house, sump sum to pay credit card debts etc for the benefit of the child until they are 18 or going to university.

If the player is no longer earning the significant amount, the CMS will automatically be re-calculated, however if they are receiving the top up maintenance, they will need to go back through the family courts to have the amount reviewed.

[18.30] Pre-nuptial agreements

Needs to be completed 28 days before you get married. It is binding contract, however not binding by UK laws yet. It shows good intention and if you satisfy all the criteria tick boxes that law commissioner report states, that will validate a pre- nuptial, it will stand up.

[22.22] Post-nuptial agreement

Is an agreement you enter post marriage. Perhaps you didn’t think about it before marriage or perhaps enough time to enter a pre-nuptial before marriage. You can then do it after the wedding. If you do a post-nuptial after the wedding and because you are married - it makes it more of a contract then the pre-nuptial agreement.

[23.43] When is it the right time to make a Will?

The importance of getting a Will in place is making sure you’re going to decide who is going to deal with your estate if the worst was to happen. There are lots of gifts and exemptions you can use under the rules which you can utilise if you didn’t have a Will in place.

There can be very intricate structures, you really need to think about who the right person is e.g. lawyer or accountant to be appointed as an executor of the estate.

If an athlete is not getting a Will to then plan their inheritance tax (IHT) in the future, they could be missing out and paying 40% to the government through IHT.

If you are getting divorce you need to review your Will. If you don’t have a will, everything will pass to your spouse under the rules of intestacy.

***LINKS***

Sports & Media podcast show page https://bit.ly/2TsBUAx

Smith & Williamson Sports, Media & Entertainment Services https://bit.ly/3e57L23

Mackrell Solicitors https://www.mackrell.com/ & https://www.mackrell.com/for-you/family/

IHT article: https://bit.ly/2WQeK9m

This episode was recorded on 16/12/2020

This S&W The Pulse podcast is of a general nature and is not a substitute for professional advice. No responsibility can be accepted for the consequences of any action taken or refrained from as a result of what is said. The views expressed are not necessarily those of the presenter or of Smith & Williamson or any of its affiliates. No reproduction of this podcast may be made in whole or in part for professional or recreational purposes. No action should be taken based on this podcast and we accept no liability if...