Equal rights under new tax laws

Under the Civil Partnership Act 2004 (CPA), couples will be able to transfer assets between themselves with no more tax liability than married couples.

However, the rules limiting married couples' options on tax will also apply to civil partners.

Pension tax legislation will also be amended to include civil partners.

Anti-avoidance

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Registered civil partners will be able to make gifts or bequests to their partners with the benefits of Inheritance Tax (IHT) or Capital Gains Tax (CGT) exemption and will have their own form of married couple's allowance.

But also on a par with married couples, civil partners will not be able to get away with dodging tax by transferring their income to others who pay less tax.

There are special rules already in place for husbands and wives, and these will be extended to same-sex couples.

As Anne Redstone from Ernst & Young points out, if one partner owns a flat in London and the other has a house in Brighton, at the moment both can be sold free of capital gains tax.

However, under civil partnership rules they will have to elect one of the properties to be their main residence and the other will be subject to tax on sale.

Divorce rules apply

CIVIL PARTNERSHIP RIGHTS Social security and pension benefits Tenancy rights Possible parental responsibility for partner's children Full recognition for life assurance Responsibility to provide reasonable maintenance for partners and children Same tax treatment as married couples, including exemptions from inheritance tax on homes Visiting rights in hospitals Key points at-a-glance

Stamp duty rules whereby divorcing married couples are exempt will also apply if property is being sold in connection with the ending of a civil partnership.

The tax changes will take effect from 5 December, 2005 - the date the CPA comes into force.

Civil partnership ceremonies will take place in front of a registrar and two witnesses at registry offices throughout the UK.

"The only real difference between marriage and civil partnership will be that couples won't be able to carry out the partnership ceremony in a church (or any religious place)," says independent financial advice website Pinklolly.