Pensions and Divorce Solicitors in London

Get in touch with us today to see how our divorce and pensions solicitors can help you.

To discuss how we can help you we can talk with you at our offices, over the phone or online via Web Conferencing such as Zoom or Skype. To get the expert legal advice you need, contact our divorce and pension solicitors in London.

Why choose OTS Solicitors as your pensions and divorce solicitors?

In family law, a pension can look simple but be complicated to value or deal with. That’s why you need pensions and divorce solicitors in London to provide:

• Pension advice on the relevance of pension sharing on divorce – every family situation is different
• Divorce and pension rights advice after listening to what you want
• Legal advice tailored to your priorities and needs
• Exceptional quality of service
• Solutions based advice on pensions and divorce law

Whether your top priority is to keep all your pension or to get a pension share to help fund your retirement the focus of our pensions and divorce solicitors is on finding out what you want to achieve and then giving you the advice you need to reach a divorce financial settlement and obtain a financial court order as quickly as possible.

Pension steps and divorce

When making a financial court order the court can share a pension (called pension sharing) or factor in the value of a pension fund in the financial court order (called pension offsetting).

Our pensions and divorce solicitors recommend that you follow these five steps to reach a fair financial settlement:

1. List all the pensions you both hold. Pensions include personal pension schemes, self-invested pension plans (SIPPs), public service pensions, occupational pensions, work pensions (final salary or defined contribution or former employment pension schemes), small self-administered schemes (SSAs) and state pensions
2. The pensions then need to be valued. Most pension administrators produce annual information on a pension, including a cash equivalent transfer value (CETV) for the pension fund. It is important to take financial and legal advice about the valuation of pensions, rather than simply relying on the CETV or assuming that a pension will not be worth much as the CETV may not adequately reflect the real value of the pension. We work with pension actuaries and independent financial advisors to ensure that pension valuations are accurate
3. Pension options then need to be explored to achieve the best overall financial settlement for you
4. Financial court orders are required because pension administrators need a court order to implement the pension share. If an agreed financial court order is being made you and your spouse will not normally need to attend a court hearing as your divorce pension solicitors can sort out all the paperwork for you and send it to the court on your behalf
5. Implementation after the financial court order is obtained by the pension administrators. This must be done within a set time limit from the making of the court order

Pension valuations

Although pensions have a cash equivalent transfer value, divorce pension solicitors and pension advisors are normally wary about relying on the CETV in a divorce settlement because the CETV is the amount the pension owner would get if they moved the pension to a different pension provider. The CETV may not be the true value of the pension fund.

How accurate the CETV is depends on the type of pension scheme.  Specialist pension divorce solicitors, pension actuaries and IFAs can recommend whether a more detailed valuation of the pension is justified to secure the best financial settlement outcome. For example, some public service pension funds (the police, teachers, NHS or civil service) produce transfer values that are lower than the value ascribed to them by a pension expert as they will consider all the pension scheme benefits and the comparable pension income available through a personal pension scheme.

The relevance of pensions

Pensions dispute solicitors often hear arguments that pensions are not relevant because:

• The marriage was short
• A husband and wife have pensions with similar transfer values
• The pension was set up before the couple married
• A pension is in payment
• A pension is part of the family business. Land or buildings where a business operates are frequently placed into a small self-administered scheme (SSAS). The assets in the SSAS pension fund should be valued so a percentage value can then be attributed to each pension scheme member and pension sharing and offsetting options explored

Pensions may be a relevant family asset in all these scenarios and therefore need to be accurately valued with the help of your divorce and pensions solicitors.

Dividing pensions on divorce

Pensions can be taken into account in a financial settlement by:-

• Offsetting the value of the pension
• Pension sharing order
• Pension attachment or earmarking order

Pension offsetting

With pension offsetting the value of a pension is offset against other assets. For example, you may want to keep the family home or more than half the equity in the property in return for your spouse keeping their pension.

To achieve the best outcome when pension offsetting it is essential that:

• Pensions are accurately valued and
• The proposed financial settlement is reality tested to ensure it meets short-term and long-term needs. For example, if your priority is to keep the family home by offsetting the value of a pension it is sensible to look at how you will fund your retirement without a pension share

Pension sharing

If a pension sharing order is made, a spouse receives a percentage share of their spouse’s pension/s. The percentage can range from one to 100% of the pension fund. The pension pot or share becomes the pension of the spouse receiving it. The pension sharing order cannot be implemented until your divorce has been finalised.

Pension attachment

Pension attachment means a proportion of a spouse’s pension is paid to the non-pension member. Pension attachment or earmarking stops if the person who is getting the benefit of the pension order remarries. Therefore, a pension attachment order may not be in your long-term best interests.

Pension options

As there are several ways that pensions can be shared as part of a divorce financial settlement it is important to ensure:

• Full financial disclosure
• Accurate pension valuations
• The pension options are fully explored so you can make informed pension and financial settlement decisions to secure the best financial settlement to meet your needs

Pension complexities

Sorting out pensions and financial settlements is complicated. For example:

• The cash equivalent value of the pension is not always an accurate way of valuing the pension. If you agree to split a pension equally, one spouse may end up with more pension income on retirement than the other even though a 50%pension sharing order was made. That is why expert pension reports may be in your best interests
• Even if a pension is in payment, a pension sharing order can still be made but, depending on the pension rules, the person receiving the pension share may not be able to get their pension until they meet a specific age – even though their spouse is retired and getting a pension income
• Some pensions can be shared by a spouse becoming a member of the existing pension scheme. Alternatively, a spouse can set up a new pension and transfer the funds. The choice of internal or external pension credit can make a difference in the amount of pension income on retirement

Divorce and Pensions Frequently Asked Questions

How is pension sharing calculated in a divorce?

A pension is shared by the person receiving it getting a percentage of its value, ranging from one to 100%. The percentage depends on whether your goal is equality of pension income in retirement (the figure won’t necessarily be 50%) or if you are partially offsetting the value of other assets, such as pensions in the receiving spouse’s name or equity in the family home.

What is the most common way pensions are split on divorce?

Pensions are commonly offset if a couple is splitting up in their 20s or 30s. Pension sharing orders are more commonplace where couples are age 40 plus or are retired.

How do I protect my pension in a divorce?

In some situations, our pension dispute solicitors can put forward the case that your pension should be protected in your divorce.

If pension sharing is likely but you want to keep your pension then pension offsetting is likely to be the best option for you. However, you will need to consider the short-term consequences against the long-term advantages of retaining all your pension for your retirement.

Can my ex-wife or husband claim my pension years after divorce?

An ex-spouse can claim your pension years after divorce if you did not get a clean break court order severing all financial ties when you divorced. Our divorce and pensions solicitors can check the wording of your order and advise you.

Contact us today to see how our divorce and pensions solicitors can help you.

To discuss how we can help you we can talk with you at our offices, over the phone or online via Web Conferencing such as Zoom or Skype. To get the expert legal advice you need, contact our divorce and pension solicitors in London.