How does getting married affect your assets?

Being in a registered partnership is the same as being married in terms of the financial consequences. Only cohabitation, with or without a cohabitation agreement, doesn’t carry the same weight as marriage.

This property regime considers either spouse’s assets as belonging to both partners. This applies to the assets that the spouses have the moment they get married as well as any future assets.

Gifts, inheritance and estates are usually exempted from this rule by means of an exclusion clause, which states that the gift, inheritance or estate belongs only to the recipient. This prevents situations in which a gift, inheritance or estate must be divided between the partners in the event of a divorce.

1. A community of property is suitable for spouses who are in more or less the same financial position at the start of their marriage and if they remain married for life. In reality, however, many couples get divorced.
2. The community of property also creates community of debt if the spouses are liable for each other’s debts, including student debt.
3. The community of property regime can be used to exploit people who are in a vulnerable position.

Couples who marry without a prenuptial agreement fall under the limited community of property regime rather than community of property regime. The limited community of property regime excludes premarital assets, gifts and inheritances from the community of property. This means that any property you have before you get married remains your own, just like any gifts, inheritance and estates you receive while you’re married. Any assets you and your partner gain together belong to you both.

Marrying in a limited community of property is the norm nowadays. But while this new system removes some snags in the old system, it doesn’t automatically make things simpler. For instance, it’s more likely that each spouse has different arrangements for their private assets. That all needs to be managed effectively, but many people fail to do so.

First, let’s define ‘premarital assets’: these are assets that did not already belong to both spouses prior to the marriage. For instance, if you bought a house together before you got married, this would be part of the community of property after you marry. If you each paid different amounts towards the purchase price before you married, such as a ratio of 70:30, ownership of the house would be 50:50 after you marry.

The same situation may apply to debts that aren’t split equally between spouses. Imagine you’re cohabiting and together purchase a house for €400,000. Partner A pays their share towards the purchase price by taking out a mortgage of €200,000. Partner B pays their share towards the purchase price by taking out a mortgage of €100,000 and using €100,000 of their own capital. Once the partners are married, the home and the debt become part of the community of property. This means that each partner has a 50% share in the total debts of €300,000, leaving partner B worse off.

While this has always been the standard legal interpretation, it’s part of an ongoing debate in jurisprudence. So we may soon have to alter the conclusion set out above.

The new rules on matrimonial regimes can have very complex repercussions. That’s why couples who intend on getting married should carefully research their current situation and look at what would change after they get married. If they conclude that the standard legal regime wouldn’t work for them, they can ask a notary to draw up a prenuptial agreement.

Many business owners choose to do this in order to shield their partner against claims from the business’s creditors. Similarly, you could think about things like: “What happens if the business does well? How much should my partner gain from that?”

There are lots of choices you can make and things to consider, so it’s a good idea to seek advice from a notary. You should also take stock of your situation every five years and check that the agreements you made are still relevant.

Generally speaking, the wealth tax burden on assets of couples with children who are born into the marriage is lower if those assets are distributed equally between the partners upon their death. Assets were often indeed distributed equally under the previous community of property regime, less so under the new limited regime. You can solve this by drawing up a prenuptial agreement that sets out the previous community of property regime.

The ‘final netting clause’ is another option, whereby each partner’s assets are treated as private and any difference in the scope of the private assets is offset by a claim. This means that the partner with greater assets is indebted to the partner with lower assets to the extent that each partner’s assets are equal.

Partners may agree that the final netting clause applies only if their marriage ends due to death. This differs from a community of property regime, which sets out that assets must also be divided in the event of divorce.

1. The general assumption is that equal asset distribution leads to a lower wealth tax burden. However, it’s always wise to check how this would affect your particular situation, taking into account things like the scope of the assets as well as your age and your partner’s age.
2. If an exclusion clause applies, you’ll need to find out whether equal asset distribution is an option.
3. Decide whether equal asset distribution is right for your situation. Couples with children from previous marriages need to pay particular attention to this. The marital community of property regime may lead to a shift in asset distribution and affect children’s claims to assets of your estate. Whatever you choose, it needs to be right for you.