Many couples in Canada choose to live together without getting married. Approximately 17% of couples living together are cohabitating in a common-law relationship.
However, this number does not accurately reflect the real rate of couple cohabitating together, which in fact is much higher.This is because many couples just choose to live together without reporting that they’re in a common-law relationship. Other relationships are so short-lived that the parties do not meet the definition of common-law under the Income Tax Act, or the Ontario Family Law Act.
The Canada Revenue Agency considers you to be in a common-law relationship when you have cohabited for 12 months, however, common-law relationships for family law purposes are defined differently all-around Canada.
In Ontario, for spousal support purposes¸ it means two persons who are not married to each other and have cohabited,
- (a) continuously for a period of not less than three years, or
- (b) in a relationship of some permanence, if they are the parents of a child as set out in section 4 of the Children’s Law Reform Act.
Regardless of the situation, it is important to protect yourself, especially when you choose to own property with your partner or are bringing in valuable property into the relationship.
A cohabitation agreement typically lays out terms for division of assets and spousal support when a common-law relationship comes to an end. This is similar to a marriage contract in that it outlines each spouse’s rights and responsibilities. Such written agreementbecomes enforceable if unfortunately,the relationship ends.
Should you get married to your partner, your cohabitation agreement automatically becomes a marriage contract without any further action required.
Many people have misconceptions about cohabiting, thinking their assets and finances are protected because they did not get married. This could not be further from the truth.
Firstly, marriage is not a prerequisite for entitlement to spousal support. Secondly, when it comes to property division, there are Trust Laws that can be applied so that property is divided as though the parties were married.
The only way to achieve some level of certainty is to enter into a property negotiated and drafted cohabitation agreement.
At AP Lawyers, we follow our standard 6-step process of:
- 1. Consultation
- 2. Communication
- 3. Disclosure
- 4. Negotiation
- 5. Drafting
- 6. Execution
We have helped people from all works of life to draft cohabitation agreements that they are happy with. Some own significant assets, while others want to protect assets they will acquire in the future. The one thing they all have in common is that they want to define the terms should the relationship fail, rather than leaving things to chance and uncertainty.