Advice for unmarried couples with children: what financial claims can be made on behalf of the children?
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When couples separate, it is difficult for both parties involved and complicated further when there are children to consider.
When the couple are not married, they do not have the same legal rights for themselves as those seeking a divorce. Emma Morris, Family Solicitor from legal and consultancy firm Ince, explains what Schedule 1 of the Children Act is and how it can help unmarried couples with children looking to separate.
Q: What is Schedule 1 of the Children Act?
A: Unmarried couples do not have any claims against each other as a result of their relationship. There could perhaps be trust claims over a property because of contribution by the non-legal owner, but these are complicated and expensive proceedings to make.
Schedule 1 gives the court power over financial provisions for children of separated, unmarried couples. Any parent with care of the child, guardian, or special guardian can apply to the court. The court can then decide what financial support is needed for a child which can take many forms, including:
Transfer or purchase of property;
A lump sum payment to cover capital expenditure; and
Periodical payments (maintenance).
Q: What rights to income and property do I have for the benefit of my children under Schedule 1 of the Children Act?
A: If the parent with care of the children does not own a property, or have the funds to pay for one, then the court can ask your child’s other parent to purchase a home where you can live with the children. If there is already a home available, the court can settle this property in such a way as to allow the parent with care of the children to remain there on specific terms i.e. until the child is 18 years of age or ceases full time education.
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It is important to understand two things: any property purchased will legally belong to the parent who purchased it, not the parent living in it with the children; and once your child turns 18 (or such other trigger as is agreed), the property will be sold and the money will be returned to the purchaser.
Schedule 1 provides a home and security for minor children and the parent with care, but it is hugely important that the parent with care understands that once the trigger event occurs, the property is sold and they need to find somewhere to live at their own expense. Therefore, they should use the time living rent free to save funds to plan for their own future.
The parent buying the home will also need to understand the potential tax implications. If they own more than one property, it will trigger a capital gains payment in the future on the property which is not their principal private residence.
This is not an arrangement that should be entered into between couples without advice. Unless a Schedule 1 housing agreement is registered by way of court order, then the parent with care can come back at a later date with a fresh housing application.
Q: Is there anything I can do to make separation easier?
A: Engaging in good legal advice from the start is always the first step to take and will ensure your best interests are protected.
Prior to moving in with a partner or having your first child, our team always recommend that our clients create a cohabitation agreement. Financially, this could address all manner of contributions and financial agreements for the future. However, so far as children are concerned, it is never possible to oust or overrule the court.
In relation to children, the documents also are useful as you can agree as a couple how you would like to educate your children, for example, again easing arguments at a later date. Cohabitation agreements are not legally binding but can help inform the court’s decision if a Schedule 1 application is made.
Q: Why should I seek help from Ince before making a Schedule 1 application?
A: Both parties should take independent, sensible and realistic legal advice before making or defending a Schedule 1 application. It can help you understand the legal process, the cost involved, and allow you to make an informed decision.
Deciding to separate is never a straightforward choice, but obtaining the right advice and being informed of all your options is the first step to making good decisions.