In proceedings for divorce or dissolution of civil partnership, the court has the power to redistribute pension benefits between the parties.

Pensions must be considered in divorce as pensions can often form the second largest asset of a marriage, after the family home. Understanding the full range of options available when dealing with pensions during divorce is important.

There are many types of pension schemes, pension benefits and ways of contributing to pension schemes.

Both parties must provide financial disclosure in respect of their pension benefits. As part of the financial disclosure process on divorce or dissolution, both parties will have to obtain the equivalent cash value for all pensions.

In this blog, our Family Law Solicitors discuss the complexities of pension division, offering guidance on how to navigate your financial options and protect your retirement savings.

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Is my spouse entitled to half my pension if we divorce?

In divorce or dissolution proceedings, the aim of the court is to achieve fairness.

The total value of both parties' pensions will be considered. In most cases, the needs of the parties will mean that the timing and the source of pension assets are less relevant, and all pension assets will need to be considered to meet the needs of the parties. The court can resort to all the available assets to ensure that both parties' needs are met.

The Pensions Advisory Group (PAG) produced its Second Edition of ‘A Guide to the Treatment of Pensions on Divorce’ in 2024. This Guide has been extensively relied upon in several reported judgments and is a well-regarded text when determining how the Court should deal with the treatment of pensions.

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How do I protect my pension on divorce?

When considering your pension in the divorce, the starting point is to have a clear understanding of how much your pension is worth. You may need to take additional steps to trace multiple pensions from previous jobs, and you may wish to consider any additional benefits attached to those pensions.

You may, understandably, wish to ring fence your pension rights. However, in reality, it is not always possible to do this depending on the needs of the parties.

As a result, you may decide to offer your spouse alternative assets in exchange for your pension during financial settlement discussions. This, along with various other options, are available to you as set out below.

How are pensions split on divorce?

In many cases, simply sharing pension rights according to the cash equivalent value will not produce a fair result because of the parties' needs, ages, and length of the marriage. It may be more appropriate to consider the percentage split to provide both parties with equal pension benefits on retirement.

When considering redistributing pension benefits, there are several options. The main options are:

Offsetting

Pension offsetting is the process whereby the value of the pension resources is set against the value of other assets held between the parties. In an offsetting case, the pension rights would remain with the pension member, and the non-pension assets would be adjusted because one party would have a less valuable pension provision.

In some circumstances, one party may wish to retain the family home at the expense of receiving a future pension. Great care must be given to offset, and you must receive appropriate advice early on.

Pension sharing

Pension sharing is a method by which an existing pension arrangement is split and divided between the parties. On divorce or dissolution, a court can make a pension sharing order transferring a part of or the whole of a pension from one party to another. A pension sharing order means the person receiving the pension would have a separate pension fund.

Pension attachment

A pension attachment order requires the person responsible for the pension to pay a percentage of the pension income, lump sum, or death benefits when a pension becomes available to the other party.

Family solicitors cannot provide financial advice, and you must receive appropriate advice early from an independent financial adviser and pension divorce expert

How much State Pension will I get if I am divorced?

The way that divorce affects your State Pension will depend on 2 things, namely:

Your State Pension age; and
Which type of State Pension you are entitled to as a result.

It is therefore important to understand the differences between the old State Pension and the new State Pension.

The old State Pension applies to people who reached their State Pension age before 6 April 2016. It consists of two parts, both the basic State Pension and the additional State Pension.

Your basic State Pension cannot be shared upon divorce. However, divorced couples can in fact use their spouses NI contributions to increase their own basic State Pension.

In respect of additional State Pension, this is based on earnings and therefore the court can decide that this is to be shared as part of the financial settlement upon divorce.

Conversely, the new State Pension applies to people who reached or will reach their State Pension age on or after 6 April 2016, and this generally cannot be shared upon divorce, unless there is some form of protected payment in place. This right, however, can be lost if the person receiving the additional State Pension decides to remarry or enter another civil partnership.

Am I entitled to half of my spouses pension if we obtain a divorce

Contact Our Family Team

At Myerson, our family team have extensive experience in dealing with this complex area of law, and we have excellent links with independent financial advisors who specialise in pension sharing on divorce. Contact us via:

0161 941 4000

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Jessica Thwaites

Trainee Solicitor

Jessica joined Myerson in September 2023 as a Trainee Solicitor and is currently undertaking her fourth seat in the Property Litigation department.

Jessica studied Law at the University of Leeds and spent a year at the University of Waterloo in Canada before graduating in 2018 with a 2:1.

Following this, Jessica worked as a Paralegal and studied the Legal Practice Course and Masters of Law part time in 2021 at the University of Law in Manchester, achieving a Distinction.

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What Happens to my Pension on Divorce?

Jessica Thwaites - Trainee Solicitor