What happens with a pension following a divorce?
Going through a divorce or separation is often stressful. There are many things to consider: Who is going to have custody of the children? What will happen to the matrimonial home? Will my ex-partner be liable to pay me spousal maintenance? With so many important questions flying around, one critical aspect is often overlooked: the pension. Sometimes – especially in the case of young divorcees – because it seems so far away, and sometimes simply because people are unaware that they might be entitled to part of their partner’s pension.
Pension sharing is a complex topic as is. When one, or both, members of a couple have international connections, further complexities come into play. At Beyer Family Law, we specialise in assisting clients with internationalconnections, especially to German and French speaking countries. Call us on +44 (0)20 8616 8560 or get in touch online for a free consultation. We can advise you on how to approach pension sharing following a divorce – be it with or without an international element.
What is the law regarding pension sharing following a divorce?
The court has the power to make pension sharing orders as part of the overall financial settlement. This is separate from spousal maintenance and is intended to ensure a fair division of assets, including provision for retirement.
According to a report by the Centre for Progressive Policy, a think tank, women in the UK provide more than twice as much unpaid childcare per year as men. This disproportionately affects both the career progression of women as well as their earning capacity. There is often the potential for women to be financially disadvantaged through a divorce if all financial elements – pension included – are not taken into consideration.
What changes if one, or both, members of the couple have international connections?
As a general rule, English courts cannot directly make pension sharing orders against foreign pension schemes. This position was considered in Goyal v Goyal and subsequent proceedings. However, foreign pensions can still be taken into account as part of the overall asset pool.
In practice, this means that alternative approaches – such as offsetting or agreement between the parties – are often used.
Will I still have to share my pension if I get a ‘clean break’?
When deciding a financial settlement following a divorce, judges will consider all assets: pensions, property, savings and investments. Pension sharing orders are often used to facilitate a clean break by separating the parties’ financial ties, including their pension provision.
How might this affect me?
If you are going through a divorce or separation and there is an international element to your marriage or civil partnership, it is in your best interests to seek legal advice at an early stage. Especially in cases involving cross-border assets, the intricate nature of pension sharing, financial orders and jurisdiction can have a significant impact on the overall settlement.
You may find that a pension you assumed would be shared cannot, in fact, be divided by the English courts. Equally, you may be entitled to a greater share of other assets to offset the value of a pension held abroad. Without proper advice, there is a real risk of overlooking valuable entitlements or agreeing to a settlement that does not fully reflect your financial position.
The approach taken will depend on the specific facts of each case and the jurisdictions involved.
Contact us
Kerstin Beyer, Monika Pirani are German-speaking family law solicitors working in London. Our firm specialises in divorce, child custody, financial disputes, mediation, pensions, maintenance and jurisdiction issues. Call us on +44 (0)20 8616 8560 – we would be happy to have an initial chat about your circumstances.
