If you’re in the process of a divorce, splitting assets is one of the most significant potential points of contention in the process.
When you’re splitting assets in a divorce in the UK, there are a lot of factors to consider. It will also depend on your individual circumstances.
That could be your earnings, the assets you own, whether there are any children involved in the relationship, and many other factors.
How Do You Begin Dividing Assets In Divorce In The UK?
The first thing to know is that the starting point for the division of assets upon divorce in the UK is for everything to be split equally – 50/50.
But it’s worth knowing that the financial settlement is likely to be different in every case.
That’s because the settlement will depend on each person’s circumstances and their needs when it comes to the matrimonial assets. This means one party could have a greater share of the assets than the other.
Matrimonial assets include things such as:
- Savings and finances
It’s worth noting that property specifically refers to property built up during the marriage and doesn’t include anything via gift or inheritance.
Essentially, the rule is that if the asset can be attributed to having achieved financial gain because of the endeavour of both people in the marriage, then it’s classed as a matrimonial asset.
The two most significant assets will likely be the matrimonial home (i.e. the home that they lived in while married) and any pensions.
So, How Do Courts Decide How To Split Assets in Divorce?
There are a lot of considerations for the court to take when dealing with the division of assets in a divorce.
First things first, they must take into account the Matrimonial Causes Act 1973 and the Civil Partnership Act 2004.
These laws include:
- The income, earning capacity, property, and other financial resources which both parties have and are likely to have in the foreseeable future
- The financial responsibilities and requirements of both parties, including any that they are likely to face in the foreseeable future
- The standard of living enjoyed by the entire family before the breakdown of the relationship
- The age of both parties in the marriage and how long they have been married for
- Any disability, whether physical or mental, of either partner
- The contributions which both people have made or are likely to make towards the welfare of the family – this includes financial AND looking after the home, caring for the family etc.
- The conduct of both partners
- The value to which both people will lose of any benefit or asset, such as losing the chance to acquire a pension or investment
What If One Partner Isn’t Able To Work?
It’s worth noting that the onus is on each party to maximise their income to ensure they’re not relying on the other if they can to be self-reliant, whether that’s completely or in part.
There are times, however, when one of the parties in the marriage might not be able to work. This could be due to caring for young children, for those with disabilities, or due to health complications.
If they don’t have an earning capacity, this is likely to cause financial problems such as not being able to afford a mortgage.
It’s also worth noting that the court can order that a property that is jointly owned can be transferred to sole ownership by either party.
It could be that one person buys the other person out of the mortgage. Even if the money isn’t due to be paid for several years.
Or, it might be that the children need the house while they are still minors.
In this case, if the parent that has care of the children can afford to maintain the property, including the mortgage, then the court will preserve the property.
That means the other parent will have to wait until the children are adults for their share of the property.
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