Why getting married abroad could land you with a HUGE bill from the taxman

Couples marrying abroad could be landed with a huge inheritance tax bill if their foreign wedding is not legally binding, a husband and wife have warned.

Antonia Medlicott, 49, and Tim Pindar, 44, tied the knot in 2009 in the wedding of their dreams in Spain.

The couples families flew out for a 'big Catholic wedding' on the continent, but were unaware that they had 14 days to register their marriage at the town hall, they told The Telegraph.

The priest who officiated the wedding had tried to warn the couple that their marriage would be null and void, but the couple did not understand Spanish and the priest did not speak any English.

The couple found out their marriage was not legally binding some months later, but decided to ignore it for the next 13 years.

However in 2023 the couple were forced to remarry, after discovering they could be set to lose a huge amount of money if one of them passed away.

The spousal exemption allows married couples to avoid paying inheritance tax when passing assets to their wife or husband when they die.

Unmarried couples however, do not have the same privilege and those who leave assets worth over £325,000 have to pay 40 per cent inheritance tax on the amount over the allowance. 

Couples getting married abroad could face a huge inheritance tax bill if their wedding is not legally binding (file image)

Antonia and Tim were forced to remarry, worrying they could lose thousands as an umarries couple (file image)

Married couples benefit from spousal privilege which gives an exemption to inheritance tax

Unmarried couples may soon lose out on pension savings too if their partner dies, under new plans by Rachel Reeves.

Pension savings can currently be left to an unmarried partner without any inheritance tax being paid, but this is set to end in 2027.

Ms Medlicott and her husband discovered that they could be set to lose thousands after speaking to a lawyer about their wills.

She said: 'He pointed out that if something happens to either one of us, there's a massive inheritance tax bill coming our way. So we decided we would have to just get on with it.'

The couple estimated they would have had an £80,000 inheritance tax bill on their house alone. With potentially more coming from pensions, savings and a business owned by Ms Medlicott.

If the worst had happened, the surviving spouse would have been forced to sell their family home to cover the bill.

Far from their extravagant Spanish wedding in 2009, the couple opted for a quieter affair in 2023.

They described their second wedding as 'bare bones' costing around £1,000 all in - including a bottomless bunch with six friends. 

Ms Medlicott wore a brown dress and borrowed boots from a friend as the couple finally officially tied the knot at a civil wedding in their local registry office.

Antonia and Tim's marriage was not legally binding as they did not register at a town hall (file image)

Unmarried couples will soon face more inheritance tax issues as pensions are set to become within the scope of the levy (file image)

Claire Trott, head of advice at St James's Place, said: 'Getting married for tax purposes isn't a new concept, particularly in the world of pensions. Many defined benefit schemes have restrictions on who death benefits can be paid to, sometimes depending on when a couple marries.

'My own father married my stepmother just before his defined benefit pension came into payment, because under the scheme rules, death benefits were only payable to the spouse at the date of retirement. Had they married after that point, even after 30 years together, she wouldn't have been entitled to anything.'

She said that marriage could soon become an even more valuable planning tool to deal with inheritance tax, particularly with pensions being brought into the scope for the levy.

Ms Medlicott said she felt 'resentful' about having to remarry just to save thousands of pounds.

She said that marriage 'isn't for everyone' and felt it was 'ridiculous' that a piece of paper could be the difference between huge sums of money for couples