Two elderly unmarried sisters have lost their appeal against a European Court of Human Rights ruling that they should pay inheritance tax when the first of them dies.

The Court held, by 15 votes to two, that there had been no violation of article 14 concerning prohibition of discrimination along with article 1 on protection of property of the European Convention on Human Rights.

The judgment stated: ‘The absence of a legally binding agreement between the applicants renders their relationship of co-habitation, despite its long duration,
fundamentally different to that of a married or civil partnership couple.’

Joyce Burden, 89, and her sister Sybil, 82, of Marlborough, Wiltshire, have
lived together for their entire lives and cared for four relatives. They inherited the house they currently share from their father, and have lived there for more than 30 years.

The pair made wills that the first to die would leave their entire estate to the surviving sister. However, under UK law, on the first death there would be an inheritance tax of 40% of the value of the surviving sister’s share exceeding £312,000 for the 2008/2009 tax year.

If they were married or in a civil partnership, there would have been an exemption to paying inheritance tax on the first death. However, as siblings they could not enter a civil partnership - the sisters complained that this amounted to discrimination.

The sisters lost their substantive claim they should be entitled to the same exemption as a married or civil partnership couple by a margin of three votes to four at an ECHR hearing last year.

Further Reading:

The European Court of Human Rights