Common is law is one of the most difficult pieces of legislation to understand. However, it's very common. In Canada, its popularity is growing rapidly.
The standard common law definition is: a partner in marriage by common law (which recognized unions created by mutual agreement and public behaviour), not by a civil or ecclesiastical ceremony. This means that technically, two people are married, without ever ever "getting married".
If you live in the Northwest Territories, you're going to want to understand Northwest Territories' common law. If you've found yourself googling "common law Northwest Territories" it basically works like this:
As soon as one moves in with a person that they share a marriage-like relationship, they've entered a common-law relationship. However, unless you've been living together for two or more years, or have children, neither of you are entitled to property after divorce.
How to Prove to CRA That We Are Common Law
Unlike traditional marriage, which comes with a certificate, common law marriage is a bit tricky to prove. This should be taken into consideration if you're debating common law vs marriage.
Shared Ownership of Residential Property
One of the best ways to prove that you're married under common law is if you share ownership of residential property. Residential property is a property designed especially for living. That means if you both own a house together, you're far more likely to prove that you're together under common law.
Joint Leases or Rental Agreements
You can also prove a common law marriage if you've both signed a lease on an apartment or car together. Your two names side by side will look good when trying to prove you're married to the CRA.
Bills for Shared Utility Accounts, Such as Gas, Electricity...
To go even further than showing the place you leased together, you can also show shared utility bills the two of you have. If two people are sharing bills, it's hard to argue against the fact that they're legally bound.
Important Documents for Both of You Showing the Same Address, Such As Driver's Licenses
If your official personal identification proves that you two live together, you'll be able to prove that you're common law at any time and any place. Just make sure you're always carrying your ID around!
Of course, beyond a driver's license as an ID, you can also carry different identification documents. A passport is a great example of one of these.
How Long After Living Together Are Considered Common Law in NWT?
In the Northwest territories, two people are in a common-law relationship if they've been living together in a marriage-like relationship for two years or more. However, you're considered common-law marriage if you have a child together, no matter how long you've been living with each other.
What Is a Cohabitation Agreement?
A cohabitation agreement is a way of remedying the fact that you don't typical get a certificate in a common law relationship. A cohab agreement proves that the two of you are a couple, and also protects certain of your personal assets.
Is It a Good Idea?
A cohabitation agreement is, in fact, a good idea. Though it's tough to think about, the two of you might split up one day. If you're not traditionally married, a cohabitation agreement could be the only thing that protects your assets.
For more information on topics like this, check out our article on joint bank accounts.
Can I Make One Before My Spouse Moves In?
You can make one before your spouse moves in. It's a good idea to do this, so you both know what to expect.
How Much Does It Cost?
Basic agreements cost less than five hundred dollars. However, if you're looking at child support, healthcare, and inheritance, you'll pay a little more.
Do I Need A Lawyer for One?
You do not need to hire a lawyer in order to make a cohabitation agreement. However, it may smooth the process along to do so.
Do Common Law Partners in NWT Have to File Taxes Together?
The income tax act says that a couple can be recognized as common law after 12 months. If you're in a common law relationship and file as single, you may be charged with tax fraud. So yes, you do have to file taxes together.
Couples should file taxes separately if they feel they haven't crossed the line into a lifelong partnership, and they haven't quite crossed the line into common law.
If you forget to change your marital status to common law, you're still technically single in the eyes of the law and must file taxes as such.
What If We Have Children Together?
By law, the definition of a parent "includes someone you were completely dependent upon and who had custody and control of you when you were under 19 years of age". This means if you have children together, you're entitled to all of the legal benefits of a married couple who has kids. You can both file children as dependents on taxes together.
What Not to Do in a Common Law Relationship
As stated earlier, you shouldn't file for taxes as single when you're in a common law relationship. You should also understand that you're entering something that's legally similar to a marriage. Do not go into the relationship unprepared.
Make sure you have all of your properties sorted out, and treat breaking up as you would treat a divorce. If you're not, your children can suffer from all of the terrible side effects that children of divorce suffer from. While common law is legally different from marriage, divorces are just as difficult.
What Is My Partner or Spouse Entitled To?
Common law spouses are entitled to many of the same things that spouses by marriage are. They're entitled to childcare, the division of property, and alimony. While you're not technically married a common-law spouse can still take your house.
Your live-in parameter is entitled to a cut of your assets and is responsible for some of your debts, but only if they're able to legally prove that you're married.
Even if you're not married, life can throw things at you that you don't expect. That's why it's important to understand the best bank accounts in Canada.
What Happens If We Separate?
Common law breakups can get just as ugly as traditional marriage breakups. If you two signed papers and proved to the law that you were married, you're going to need to follow through, and treat the divorce as a real divorce.
You can kick your common-law spouse out if things get truly ugly. The process isn't quite the same as divorce, but it's very similar. You don't "file for divorce", but you'll need to create a separation agreement.
A separation agreement should be handled by lawyers. Negotiation is common in divorces, and if necessary, should also be used in common law separations. Just like in a divorce, all parties will need to have their own, individual, legal advice.
If you're able to, try to work out everything in a separation agreement. This will be the smoothest for all parties involved. If you can't agree on certain things, the judge will rule who can get it.
If you have a written agreement about who will take which properties, this will in fact hold up in court, so you should hold onto it. However, any agreement you made verbally needs to be put into writing, or else it cannot be proved. Make sure you do not write or sign any agreements without completely thinking through the decision.
Unfortunately, there's no such thing as "legal separation". Once one of you moves out, you're separated in the eyes of the law. After all, you moving in together was what caused you to become a common law relationship anyway.
Understanding Common Law in NWT
Common law is difficult to understand. It's not marriage... but it's not quite being single either. Before you move in with a significant other, you should understand that you're considered common-law married after two years of living together.
After that period of time, you can start filing taxes together and gain some of the benefits of marriage. However, make sure you keep records of who's property is who's because common law breakups can be just as nasty as standard divorces.
In the case of a tough breakup, you're going to want to make sure you don't have an insurance company that screws you over as well. That's what Insurdinary has made it their mission to find you the best companies around. For more information, get a quote with us today.