Financial
Financial Issues
Maintenance
Clean break
Pensions
If you do proceed with a divorce or alternatively just decide to separate then it will be necessary to consider how this will affect you financially. Financial issues will be resolved taking into account your individual circumstances and the law.
Recent case law has established that assets should be divided equally between parties wherever possible unless the circumstances dictate otherwise.
Raleys family law team have the experience to advise you on the best approach to financial issues depending on your circumstances and will guide you through the court process should that become necessary.
The best way of sorting out the financial aspect of the divorce is to come to an agreement based on a full disclosure of information about the marriage assets. The information you need to disclose is as follows:-
- P60 for last financial year.
- Last three months wage slips.
- Mortgage redemption statement.
- Current surrender value for any endowment or other policies.
- CETV (cash equivalent transfer value) for all pensions.
- Documentary evidence regarding all debts and loans.
- Copy bank statements for last twelve months for all accounts held.
- Documentary evidence of any other savings or investments.
This agreement can then be confirmed by a Court Order known as a Consent Order making it final and binding. The procedure for obtaining such an order is very simple and can be done without anyone having to attend.
Maintenance
In some cases it is appropriate for one spouse to pay maintenance to the other, particularly if there has been a long marriage or there is a large difference between the parties’ respective incomes. In those circumstances maintenance can be payable until either party dies or sometimes for a limited period, with an option for it to be extended at a later date. The court may also consider it is appropriate to capitalise maintenance. This would mean that the court may order one party to pay a lump sum in lieu of maintenance so that the receiving party can invest the capital and receive an income from it in the future.
The level of maintenance payable depends on your individual circumstances. In any event the court will always consider whether or not a maintenance order should be made at all.
Clean break
The court is under a duty to consider a clean break in every case. A clean break is an order which prevents either party returning in the future to make a claim against the other party in relation to their income, assets or pension entitlement.
Pensions
It will be necessary for the court to consider each party’s pension entitlement and how this should be divided. This area of law is very complicated and requires careful consideration within the context of the other assets of the marriage. The court is able to deal with the pension using various methods. They are as follows:-
- Pension Sharing
One party’s pension fund can be split to enable the other party to receive whatever percentage can be agreed or what the court feels is appropriate. This percentage is then transferred into the recipients own pension fund, either within the existing scheme or to another scheme.
- Attachment
This method is rarely used but is a method whereby one party can claim a percentage of the other party’s pension upon their retirement. This can be unpopular as should you successfully obtain a percentage you would no longer be entitled to receive it, should your spouse die.
- Offsetting
This is often used where there are smaller pension funds. Often, it can be agreed one party will receive a larger share of the capital assets to compensate them for the difference in the respective pension funds.
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