Matrimonial and non-matrimonial assets in a divorce settlement explained, including what counts as a matrimonial asset and what to do if your partner is hiding assets.
What are matrimonial assets?
Matrimonial assets are any assets that you, and your partner, acquired during the course of your marriage. They can also be assets acquired during any time you lived together before you got married (‘pre-marriage cohabitation’). Your combined assets must be divided fairly in the divorce - even if one partner earned more or contributed more financially during the marriage.
Common examples of matrimonial assets include:
- The family home
- Your pension
- Financial assets, such as your savings and investments.
Dividing complex assets can make a divorce more complicated. It helps if both partners are committed to open, honest communication during the divorce process.
Will my partner get a share of my pension if we divorce?
If you paid in to a pension during your marriage, your spouse may be entitled to some (or potentially all) of it through a ‘pension sharing order’. Pensions are often seen as joint ‘savings for retirement’ and so fall within the savings and investment part of the matrimonial assets.
A pension sharing order (PSO) is issued by the Court, and states how much of your pension your spouse will receive, or how much of their pension you will receive. The amount of pension is shown as a percentage of the transfer value.
What are non-matrimonial assets?
Non-matrimonial assets are assets acquired before you got married or after the date of your separation. It is often the case that such assets have not been mingled during the marriage with the person’s husband or wife.
Non-matrimonial assets can also include assets acquired after the marriage. Assets might be gifts, an inheritance or as simply as capital acquired through earnings or investments. However, it is not always easy or straightforward to agree on what assets should be considered non-matrimonial.
What is considered a non-matrimonial asset during a divorce?
There is no standard definition on what is considered a non-matrimonial asset. The way your assets are divided and defined depends on your individual circumstances, the needs of both partners and any children you may have.
Non-matrimonial assets can be included in the divorce settlement discussion, and shared between both partners, if there is a good reason to do so. For example, they may be included in order to meet the needs of either partner.
Can I stop my assets being included in the divorce settlement?
If you think something should be considered a non-matrimonial asset during your divorce, you can make a request to the court for it to be considered such and potentially excluded from the settlement. This might be appropriate if:
- you received an inheritance, or are due to receive an inheritance, after you separated from your partner
- you owned property before you were married, such as buy-to-let rental properties, share portfolio or other assets that have not been integrated into the marital assets
- you had a valuable pension before you were married
- you set up or owned a company/business before you were married.
Your request is more likely to succeed if:
- your matrimonial assets adequately cover the needs of both partners to provide for themselves and any children
- you have been open and honest in your financial disclosure from the beginning you have been married a comparatively short time.
Is a house bought before the marriage considered non-matrimonial or matrimonial property?
If you bought a house before you got married, it may be considered matrimonial property if:
- You and your partner lived in the house together during the marriage (i.e. it was the family home)
- The property was improved by resources accrued within the marriage (for example, if your partner contributed financially or physically to an extension or renovation)
- The property generated income which was used to support the marriage (for example, if you let the property out and used the money to pay for you and your partner’s living expenses).
Is the matrimonial home always shared equally?
People often assume that what becomes the matrimonial home should be shared equally. However, even if the matrimonial home is in joint names, it might not be shared equally if it is the case that the source of the property is from what might otherwise be considered ‘non-matrimonial’.
High value assets in a divorce
High value assets present extra challenges during a divorce and reaching a fair settlement relies on honesty and transparency between both partners. Examples of high value assets in a divorce include:
- businesses or shares in a business
- high level remuneration package with Long Term Incentive Plans and shares-based incentive schemes
- fine art, antiques and classic cars
- property investments, such as rental properties, second homes or land.
Unfortunately, it is not unheard of for one partner to attempt to hide assets so they are not included in the financial settlement. This is known as ‘concealing assets’ and, if proved as being a deliberate attempt to mislead the court, is perjury. This affects the credibility of the partner attempting to mislead the court and can result in a poorer outcome for them in the divorce settlement. They may also be liable to pay costs.
If one party attempts to dispose of (sell or use up) or otherwise conceal assets with the aim of frustrating the court’s jurisdiction to dispose of the assets of the marriage fairly, the court can issue an injunction preventing disposal and freezing bank accounts and can also award a higher share of the remaining assets to the other party in compensation.
High net worth divorce specialists
If you have complex or significant assets to deal with during your divorce, taking the right legal advice at an early stage can help to protect your interests. A specialist divorce law solicitor can help you get the best possible result in the settlement.
Come in and see us for a FREE 20 minute face-to-face consultation about your options. Alternatively, if you want us to take a closer look at your situation, for a fixed fee of £150 + VAT, we can talk with you for up to 90 minutes.