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Treatment of Pensions

One of the assets which couples may wish to divide between them upon separation is a pension.

The court can order such a division when a decree of divorce or nullity is pronounced or upon the dissolution of a civil partnership (but not in proceedings for judicial separation). 

Broadly speaking all forms of pension schemes within the UK can be the subject of a pension sharing order (save for the basic state pension scheme), whether they are already in payment or still accruing.

The pension sharing order will specify the percentage of the pension which is to be transferred. Sometimes it will be possible to transfer the pension credit into a new pension within the existing scheme but sometimes a transfer will need to be made out to a completely new scheme.

An important point to consider is the age at which benefits can be drawn and this is usually not less than 55 and will depend on the rules of the scheme. We can put you in touch with people who can advise you on the most appropriate way to receive your pension credit and how to invest it.

In certain circumstances it may be more appropriate to have a pension attachment order instead (eg judicial separation) but the main disadvantage of such an order is that no new pension is created in the party’s own name so the pension dies when the member spouse dies. There can, however, be advantages to such an arrangement and so careful consideration needs to be given to the best way to formulate any pension related order.