Private Clients


It is an unfortunate fact that many marriages do finish in divorce. In a surprising number of cases one or both partners has significant pension rights, which make up a large percentage of the matrimonial assets. When determining a suitable resolution, the Court is required to take into account the pension rights of both parties, and where appropriate all or part of a pension can be awarded to an individual party.

After establishing the value of pension rights, it is important to understand the types of scheme involved. You should be particularly wary where Occupational schemes are involved and due to their complex nature, it is vital you receive professional assistance. It is also important to understand the implications of the three different methods that can be used when using a pension in a divorce settlement:-

Offsetting – Asset values are combined and one party maintains the pension rights whilst the other party is given the benefit of other assets, such as the right to live in the matrimonial home.

Earmarking – Court will instruct the pension scheme to pay a proportion of benefits to the other party including a pension income and/ or Tax Free Cash. Settlement is however made on instruction from the owner of the pension, who remains in control of when benefits can be taken.

Sharing – Court will allocate a specified percentage of the value of the pension which is usually transferred to a product/provider of the ex- spouse’s choice. The aim is to provide a “clean-break”

Should you require advice on how best to deal with a pension settlement, please do get in contact. With divorce being a stressful and emotional time, taking care of your financial security should provide some peace of mind.

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