Married versus common-law: what actually differs
For income tax purposes a common-law partner is a spouse, full stop. The differences that do exist sit almost entirely outside the tax system, in provincial property law and estate law — which is where people are usually surprised.
What is identical
Once the definition is met — generally a conjugal relationship for twelve continuous months, or immediately with a shared child — federal tax treats the two the same. That includes every mechanic in this series:
- Pension income splitting, worth $28,661 across the example couple’s plan in episode 28.
- Spousal RRSP contributions, and the spousal amount credit.
- Tax-free rollover of registered accounts and the TFSA successor-holder designation on death.
- Non-registered assets transferring at cost base, deferring the gain to the second death.
- Household-income testing for income-tested benefits — and both partners assessed individually against the $86,912 OAS recovery threshold.
What differs: provincial property law
Family property regimes are provincial, and they treat the two relationships very differently. In several provinces married spouses have a statutory right to an equalised share of family property on separation, and common-law partners do not — they are left to ordinary property law and claims in unjust enrichment.
Some provinces have extended property rights to common-law partners after a period of cohabitation; others have not. The variation between provinces is larger than the variation between the two relationship types within any one province, which is why a general answer is impossible.
What differs: dying without a will
Provincial intestacy rules — what happens with no will — generally provide for a married spouse. Whether they provide for a common-law partner, and how much, varies by province. In some, a long-term partner may inherit nothing under intestacy.
This is the difference with the sharpest practical edge, and it is also the easiest to remove: a will names whoever you name, regardless of relationship status. Beneficiary designations on registered accounts and insurance work the same way.
The same plan either way
Dan & Marie — 58 and 56, Alberta. Dan retires at 62 with a defined-benefit pension; Marie retires at 60. Their RRSPs are very different sizes, which matters later.
Every figure in Dan and Marie’s episodes — the splitting saving, the rollover on death, the survivor’s CPP, the deemed disposition deferred to the second death — is unchanged by whether they are married or common-law. The projection does not ask, because federal tax does not either.
Two identical bars is the point of the figure. What differs for this couple is not in the projection at all — it is in whether a separation would trigger an equalisation claim, and in what happens if one of them dies without a will.
The one asymmetry worth naming
Becoming common-law happens by living, without paperwork and often without either partner marking the date. Marriage happens deliberately. So a couple can acquire the full set of tax consequences — including obligations to report combined income for benefit purposes — without ever having had a conversation about it.
That matters most for income-tested benefits, which switch from individual to household assessment. It is a real change in position that arrives on a date nobody wrote down.
The household section takes two people and a province, and the projection applies the spousal mechanics that federal tax grants either relationship — so the plan reflects your actual position.
Next: separation, and rebuilding a retirement plan from one household into two.
GlidePathEngine is an educational planning tool — not financial, investment, tax, or legal advice.