Pension Sharing During Divorce

Why pensions matter in divorce

Pensions can be one of the largest assets in a divorce or civil partnership dissolution. In some cases, a pension may be worth as much as, or more than, the family home. A financial settlement should therefore consider pensions alongside property, savings, income, business interests and other assets.

Oakens Associates helps potential clients provide structured information so that a matter can be reviewed efficiently before referral to an appropriate legal practitioner.

What is a pension sharing order?

A pension sharing order is a court order that allows a percentage of one person's pension rights to be transferred for the benefit of the other party as part of a divorce or dissolution financial settlement.

Government and consumer guidance recognises pension sharing, pension attachment/earmarking and pension offsetting as common ways pensions may be dealt with on divorce. Pension sharing normally requires a formal court order before a pension provider can implement the split.

Common pension issues after separation

• One spouse has a much larger workplace or private pension.
• The family home is being kept by one party while pension rights are retained by the other.
• There are public sector, final salary or defined benefit pensions.
• One party does not know the value of the other party's pension.
• The parties have agreed a financial settlement but pensions have not been properly addressed.
• There is a concern that a clean break order may be unsafe without pension advice.

Evidence that may be useful

• Recent pension statements.
• Cash Equivalent Transfer Value information.
• Details of workplace, private and public sector pensions.
• Financial disclosure documents such as Form E, where available.
• Draft consent order or financial remedy paperwork, if already prepared.
• Information about property, savings, debts, income and dependants.

When should you get advice?

You should consider advice before agreeing to exclude pensions from a settlement, before signing a consent order, or where the pension value is unclear. Pension settlements can be technical, particularly where there are defined benefit schemes, public sector pensions, overseas pensions or a large difference in retirement provision.

Oakens does not replace legal advice. Our role is to collect initial structured information, assess whether the matter appears suitable for review, and help prepare the file for legal practitioners.

Frequently asked questions

Can my ex claim part of my pension?

Pensions can be considered as part of the overall financial settlement in divorce or civil partnership dissolution. Whether a pension share is appropriate depends on the full financial picture.

Can pensions be ignored if we agree?

Parties may reach agreement, but pensions should still be considered carefully. A court-approved order is usually needed to make a financial agreement binding.

Is pension sharing the same as offsetting?

No. Pension sharing transfers pension rights. Offsetting means one party keeps more pension while the other receives other assets, such as more equity in property.