Pensions on Divorce

In a divorce, the court can make a pension sharing order to divide pension savings between both parties. This order directs the pension provider to transfer a specified percentage (up to 100%) of the pension’s value to the designated recipient. However, pensions can only be shared if a court order is in place and a court order can only made within a divorce. This doesn’t mean you have to go to court though, a financial order on divorce can be made by agreement, known as a consent order, and simply approved by the court to make it legally binding.

Because of the requirement to have a court order, pension sharing is not available to unmarried couples on separation and not available for married couples choosing to have a separation agreement or a judicial separation.

Private pensions, including occupational, public sector and workplace pensions, can be divided this way, and certain parts of the state pension may also be shared.

Many couples reach a financial agreement through a process called ‘offsetting.’ This means one person gives up their right to a pension benefit in exchange for another asset they can access immediately. For example, one spouse may keep their entire pension fund while the other receives a larger share—or all—of the family home.

Offsetting can be arranged informally, within a separation agreement or as part of a court-approved agreement. However, proceeding without a court order is risky, as either party could later apply for a different financial order. Seeking expert advice is essential, as offsetting can be complex and may lead to unfair outcomes.

Many divorcing couples opt for offsetting, especially when one partner, often the primary caregiver of young children, needs to stay in the family home and few other assets are available besides the pension. However, while it may seem like a simple solution, it can have significant financial consequences if not handled carefully. Our experts can guide you through all available options and help to ensure you make the right decisions for your future when you get divorced.

Another type of order a judge can issue is a pension attachment order. This requires a percentage of one person’s pension payments – received weekly or monthly – to be paid to their ex, or vice versa.

However, pension attachment orders have significant drawbacks. The recipient must wait until their ex starts receiving their pension, and payments stop if the pension holder dies or if the recipient remarries. Additionally, either party can request changes to the order later, reducing financial certainty.

Due to these limitations, pension attachment orders are now rarely used, but in certain cases a pension attachment order really is the most suitable. Our experts will identify if a pension attachment order may be preferable in your case.

You may be entitled to share in your spouse’s pension and our experts will advise about your pension claim. A lot will depend on the value of your own pensions, your respective ages, how long you have been married and what other assets are available. If you have sacrificed some of your career and pension contributions to raise a family and care for children, you may well be entitled to share in your spouse’s pension as this will be considered a matrimonial asset.

It may be possible to protect your pension from being shared, especially if there are significant other assets available for offsetting (see above) or if your marriage has been short. If you’re not yet married, it may be sensible to consider entering a prenuptial agreement before your wedding to protect your pension, or reduce a future pension sharing order.

No. Only those who are married or in civil partnerships may be entitled to share in their ex’s pension. There is no “common law marriage” in law and even if you’ve lived together for many years, you cannot seek a share of an ex-partner’s pension unless you were legally married or in a civil partnership.

A CETV is the estimated cash value of your pension if you were to transfer it to another scheme. Confusingly, for divorce purposes, pension CETVs are not treated as being equivalent to other assets; for example £100,000 in a pension is not likely to be considered equal to £100,000 in cash savings because the pension is often inaccessible and subject to taxation. For this reason, expert advice is always recommended when dealing with pensions.

It may be possible to informally deal with pensions by way of offsetting without a solicitor but it’s very risky and may lead to a very unfair outcome. We recommend seeking early advice where pensions are involved as obtaining CETVs from pension providers can take time and if Pension on Divorce Expert (PODE) or actuary advice is required, this will take further time. Our experts will consider the pension issues with you from the outset to ensure that things are progressed as quickly as possible.

Possibly is the short answer. If you got divorced without a financial court order, your ex may be able to pursue a pension claim against you years down the line. If you have been separated without a divorce then your ex can certainly pursue a pension claim against you if they now commence divorce proceedings. It’s imperative to get legal advice as soon as you separate if protecting your pension, and future pension accruals, is important to you.