Marriage & Divorce: Benefits of Marriage | Are prenups worth it? | How to divorce cheaply| Splitting pensions, mortgages & more
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October 28, 2024
TLDR: Expert discussion on marriage and divorce topics including pre-nuptial agreements, asset splitting, affordable divorces, and financial benefits of marriage.

In the latest episode of the Not The Martin Lewis Podcast, host Martin Lewis dives deep into the complexities of marriage and divorce, inviting expert guests to share valuable insights and practical advice. This summary captures the essence of their discussion, focusing on the financial implications of marriage, the worth of prenuptial agreements, how to divorce cheaply, and how to fairly split assets like pensions and mortgages.
Financial Benefits of Marriage
The experts highlight several key financial benefits associated with marriage:
- Inheritance Tax Benefits: Married couples can pass on their estate without incurring inheritance tax. This includes the ability to pool unused allowances to potentially pass on up to £1 million tax-free.
- Capital Gains Tax Advantages: Married individuals can transfer assets between themselves without capital gains taxes, offering significant savings, especially if one spouse is in a lower tax bracket.
- Stronger Legal Protection: Divorce lawyer Matthew Taylor emphasizes that married couples have more robust legal protections compared to cohabitants, including claims for spousal maintenance and pension sharing.
- Sharing of Allowances: Couples can structure their finances more effectively, optimizing tax liabilities through joint savings accounts.
Prenuptial Agreements: Are They Worth It?
The conversation shifts to prenuptial agreements, with key points including:
- Legal expert Matthew Taylor explains that prenups can protect assets acquired before marriage or specify financial agreements post-marriage. However, they must be fair and meet both parties' needs, especially those of any children.
- The effectiveness of these agreements can vary, especially if legal formalities such as independent legal advice are not adhered to.
- Prenups are becoming increasingly common, particularly for second marriages, to protect children’s inheritance and family legacies.
Divorcing Cheaply
For those seeking a straightforward divorce, the experts outline several options:
- The divorce process itself has been streamlined and can often be handled online without court appearances.
- Couples can utilize resources like mediation to arrive at amicable financial settlements, reducing the potential costs involved in hiring multiple lawyers.
- It is crucial to obtain a clean break consent order to avoid future claims on assets or pensions long after the divorce is finalized.
Splitting Assets: Pensions, Mortgages, and More
Dividing assets during divorce can be complex, especially concerning pensions and mortgages. Key insights include:
- Splitting Pensions: Pensions accrued during the marriage are considered marital assets and can be split via pension sharing orders. This includes both defined benefit and money purchase pensions, which require careful valuation.
- Impact of Debt: Issues regarding debt and financial contributions are often contentious. The law aims to ensure fairness, factoring in both parties’ needs and contributions.
- Mortgages: One partner can seek to transfer mortgage responsibility by applying for a transfer of equity with the mortgage provider, ensuring that only one name remains on the mortgage.
Advice from Experts
In closing, the experts share their final advice on navigating marriage and divorce:
- Rachel Kelsey (Scotland): Discuss money and finances openly before marriage.
- Tamsin Kane (Financial Advisor): Familiarize yourself with pension implications during divorce.
- Matthew Taylor (Divorce Solicitor): Understand that engaging lawyers can lead to reduced assets; focus on mediation and pragmatism.
- Karen Quinn (Northern Ireland): Focus on the process of discovery to identify and agree on assets.
Final Thoughts
This podcast episode provided a wealth of information for anyone considering marriage or navigating the challenges of divorce. With expert advice on financial benefits, the importance of prenuptial agreements, and guidance on asset splitting, listeners are better equipped to make informed decisions.
This summarization encapsulates the key discussions from the podcast episode, making it easier for readers to absorb valuable insights regarding marriage and divorce.
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Hello and welcome to the Not the Martin Lewis Podcast, which rather confusingly is an offshoot of my normal The Martin Lewis Podcast. The difference? Well, there are some subjects that are outside of my wheelhouse or I can't answer questions on due to regulations. So in this podcast, I'm joined by specialists and I'm asking not answering the questions. Well, it's me. I might just chip in with the odd note or two.
And today it's all about marriage and divorce. So in this pod, what actually are the financial benefits of marriage? Do prenuptial agreements hold weight in England, Scotland, Wales and Northern Ireland? How to divorce cheaply?
How do you split assets? How do you split pensions? And what are the divorce settlements when it comes to children? Now, we're going to be focusing mainly on the law in England and Wales, which are the same, but we've also got experts from Northern Ireland and Scotland who will be able to feed in when it's different in those two UK nations. Let's play the theme tune.
I'm delighted to be joined by Divorce lawyer Matthew Taylor, who's a partner at Stowe Family Law and independent financial advisor, Tamsin Kane, from Smart Financial Planning, who's an accredited specialist on Divorce Finance. So we got the lawyer and we got the finance person. You're both into marriage and divorce. I'm not sure what that means, but we'll just take that phrase and carry it on out to find out. So I'm going to start with marriage because I didn't just want to do divorce. We'll start with a question from Helen Smith.
I got married two weeks ago, got my name changed on the accounts and had a 75 minute review with the NatWest Senior Bank official. Any advantages of being married as he's the breadwinner and I can't work as I have a disability following a stroke six years ago. Now I cheated here and made a little list because I knew the question beforehand but I think we'll try going around in order and we'll each try and pick off a benefit of marriage, a financial benefit of marriage and if we run out we run out. So I'm going to start with the big one and take the easy one which is inheritance tax.
When you get married, you can pass on anything you like when you die to your spouse and there is no inheritance tax on it. But arguably even more importantly on than that is you can pass on your unused allowance.
So you get £325,000 that your exempt from inheritance tax and a possible £175,000 on top if you're passing your main home onto your descendants. But if you've left everything to your spouse and they pass it on, then they get your allowances too, which means add them all together and that's a million pounds of property and estate that can be passed on to direct descendants without any inheritance tax.
If you weren't married, and when I say married, we also mean civil partnerships here. If you weren't married, you'd only be able to pass on a maximum 500,000. So that's my starter, and that gives you a little bit of thinking time for yours. Tamsin, have you got one?
Love it. I'm going to go with the next easiest one being as you've started with the tax one I'm going to go with the other tax one which is capital gains tax. So if you are married you can pass on any of your assets capital gains tax free to your spouse which might mean if you're a higher rate tax payer and your spouse is not or in this lady's case her husband is a higher rate tax payer presumably and she is not
She can have his assets and encash them capital gains tax at her rate, which could mean using her personal allowance, could mean at basic rate. Perfect. Matthew, you've got one. So I'm going to jump straight to the cynical divorce lawyer perspective.
You are better off if the relationship ends. There's a great deal of difference in the law that protects married couples and cohabitants on the separation. For cohabitants, the claims at the end of a relationship are largely limited to property and any benefit for children, financial claims for children. There is no claim for spousal maintenance. There are no pension sharing orders and things that I'm sure will come on to talk about. I've got whole categories of those.
I'm sure you do, so it's no spoiler alert. But as a married person, and particularly for this lady situation where she's not working, and it's probably that it sounds like the financially vulnerable person in the partnership, she would be in a far better position if the marriage would come to an end than if a cohabiting relationship would come to an end. So it's horribly cynical from a divorce law, but that's where my mind goes straight away.
Well, that wasn't on my list, so I like that one. That's why you're here. I'm just a slight different to Thamesans here, which is where you've talked about capital gains tax. You can do the same on income tax on savings because you can pass any assets to your spouse, free of any income tax and inheritance tax considerations. And therefore, if one of you is over the personal savings allowance, that £1000 a year, a basic rate tax per can earn each year without paying tax on the savings interest. Well, they could give some of the money provided you got a trusted relationship. We'll come on to that later.
You know, financial coercion is an issue. But if you've got a trusted relationship, you can pass some of the money onto your spouse so that the interest they earn is then tax-free. I do have a couple more. Shall I do the more duer of you got anymore in your head?
I guess the other thing that was in my head is you can structure your savings and investments more carefully if there are two of you that are married because you can make the use of personal allowances of basic rate tax brackets if there are two of you in a marriage. As you say, trusted relationship because that's something that I'm quite hot on, making sure that finances, you know, when you get married, they're shared and that needs to be very, very clear to people, I think.
So I'll do my last two. You can inherit the ISA allowance of your partner of your spouse, which you can't do in the same way if you're not married. And then my other thought was in testacy laws. So if you die without a will, you are governed by the in testacy laws. The in testacy laws have provision for your married or civil partner spouse. They don't have provision for your
cohabiting what people call a common-law spouse. So, you know, you really do need a will if you are not married because otherwise the money isn't going to come across. So that, I think that's quite a nice, we're being positive about marriage. Oh, and of course the marriage tax allowance. That's the final one. If you're
For a non-pat taxpayer married to a basic rate taxpayer, you can give them some of your personal allowance and then they can earn more money tax-free than otherwise. We're not going to go back into that in detail because I did it many times in the normal podcast, but that's a really important one too. So that's our warm up question, guys. How do we do it?
That's all right, nice and positive to start. I'm sure we can take the positivity down a little bit from this point. Well, I think this is probably one for you, Matthew, because it's a legal one. And I'm not sure there is any difference, but it's from Rhee who says, what are the benefits of a civil partnership versus marriage for a heterosexual couple who currently live together with no dependents and as part of that one side owns a property? My assumption is they're the same, aren't they?
To all intents and purposes, yes. Legally, they carry the same status. It's really about how you feel about marriage. And lots of people feel that the baggage of the patriarchal system and marriage as was is not something that fits with their values. And in that case, a civil partnership is something they might prefer. But legally, the dissolution of a civil partnership is the same process as a divorce for a marriage. And the finances will be dealt with in exactly the same way.
So I've had many people who've got in touch with me over the years to say they got married having heard me talk. I had one the other day who said, I've been engaged for 17 years. And she's never agreed to get married. She heard you talk once and now we're getting married. And it was because of inheritance tax. I'm trying to protect the property. Well, for those people who were, you know, philosophically object to the concept of marriage, you need a contract and the marriage is a contract. And a civil partnership is a contract that does the same thing, but without the baggage of marriage. So it's the same.
Yeah, to all intents and purposes, it's the same. There's no difference it comes to the end of the relationship, the end of the marriage, the end of the civil partnership, they're treated in the same way.
Right, let's move on. The next section is prenuptial agreements, which is the sort of the, again, we're starting to move towards the impact of divorce, but before you get there. And arguably the advantage of a prenuptial agreement, an agreement before you get married of what will happen afterwards is you can have that agreement when you both love each other, rather than when you're both angry and annoyed at each other and the back end of the marriage having not worked out. And you can hope your prenuptial will be never be needed. But if it is, it's been, if it's so, let's go with Santa, who says,
how effective are pre-nuptial agreements in England, particularly regarding income and wealth acquired after the marriage? They're pretty good. So pre-nupts and post-nupts as well. So it's post-nuptial agreements and pre-nuptial agreements are the same thing, but post-nuptial agreements entered into after the marriage. And provided you comply with certain formalities for each, so get an independent legal advice. There's disclosure, so
The independent legal advice is really important. You need separate lawyers, don't you? You do. You can't have one lawyer just drop an agreement or it'll probably wipe in court. I think it's far more open to challenge if you've not had independent legal advice. There is a bit of case law where sometimes it kind of riggles through, but it's really unadvisable. So everyone that I do, and I do quite a lot, will always require independent legal advice for if I'm drafting it for normally the party who's seeking to protect the assets, then the weaker party will have to take an independent legal advice. If you comply with all that,
then they're not fully binding. You can't put whatever you want in a prenup. You can't say, I keep everything and my spouse gets nothing. Because what the court, and we'll come back to this concept, I'm sure later, the court has to make sure that people's needs are met. And it's their reasonable needs for housing, for pension, for income. And in particular, the needs of any minor children. That's the number one thing that the court has to have an eye on. So you can't say whatever you like.
But if you follow all the formalities, and it's broadly fair, and it might be stingy, it might be a bit less, and generally it would be less than you would receive as the weaker party on divorce. They're really useful. And they're becoming more and more common. I think there's still a little bit of a perception of them as being a celebrity thing, but more and more common, and particularly useful for second marriages where people have pre-acquired assets, and they are seeking to leave them to their children.
so they don't lose them in a later divorce, but once bitten twice shy, that's really common. Gifts from parents, the bank of mum and dad, inheritances, that's when they're really common. So, they can be really, really useful. So, in that specific example about assets acquired after the marriage, it depends when it comes in. Generally, they use to protect assets that are pre-acquired, actually. That's the most common setup.
but I was drafting one this week just gone which is a very sort of normal case as a house of a couple hundred grand and there's a couple of pensions so it's not a big big money case and the idea in that case was that my client was quite happy for his wife to be to keep her pension and she can keep whatever pension she accrues in the future so she is agreed that's that's hers she works hard for it I'm not interested in it I've got my own assets so you can put that in a prenup you can put that in a post knob you can
be fairly flexible in what you agree. Generally, as I say, it tends to be to protect pre-acquired assets normally, but if you want to agree something and provide it it's broadly fair and people's needs are met and everyone's had legal advice and knows what rights they're giving up, then they're likely to stand up and court. Just a follow-up from David who says, what circumstances can render them non-avoid? If there hasn't been independent legal advice,
If there hasn't been disclosure, or someone has not been honest with their disclosure, so you're sitting on a Swiss bank account with a million Swiss francs in, and that accidentally forgot to mention it, that would cause problems. The fairness point is the real one, that's the real strong one, and there's also a timing issue.
are you, I presume, are looking at what the court would normally award in the case of divorce and saying, how do we nuance this so it's more favourable to the person who is your client at this time rather than how do we put a bulldozer through it so we're destroying what the court would do? Yeah, absolutely. You can't put something in and I will often say that's not giving enough. That's not giving enough. Your crystal ball goes a lot because
A marriage that lasts five years with no children is entirely different from one of the last thirty years with children, where both parties are working and one person stops working. I remember there's a sort of codified form of percentages that based on marriage, longevity and how many children you've got. Is this something?
Not really, there's been attempts to kind of get there. I mean, the only formula that we work with is as far as child maintenance goes, which probably something we'll talk about in a little bit in the child maintenance service. I mean, very broadly speaking, if you're in a long marriage and you're not arguing about the source of assets, it's sort of other than divide by two in a lot of cases. And then you might, so it's a very simple formula and you might depart from that for various reasons. So you're not looking to say what you don't want to do and what I don't want to do for my clients is do a prenup that is too ambitious.
It's too stingy because they end up in litigation years later. So you need to be reasonable. Also, these people are starting out in marriage. You don't want to start over by screwing over your spouse to be. It's not the most romantic thing in the world, is it? It's not. It's not. So you need to be delicate. You need to be sensible. There needs to be pragmatism and cooperation. How would you suggest, maybe both of you, I don't know if you've had any experience of this, Tamzin?
If someone are listening out there now is going, I sort of want to propose, but I am worried about the inheritance my parents will give me or protecting other money. How would you broach a prenup? I'm interested to know what your advice would be on that, either of you. I think that being straight about it is the best. I always say, look, it's not an easy conversation. If it's inheritance, if it's money from the parents,
can paint your parents as the bad guys and say, look, my parents have raised this to me and they insist. And actually, that happens quite a lot. They just genuinely got some of those questions coming out actually. So that's something, that's the dynamic that works. But most people are reasonable. And most people realize, OK, well, look, you've worked hard. You've had this house. These might be second marriages, silver splitters who've got divorced later in life and then get remarried. And there's an understanding that comes with that, the wisdom of having things and then saying, well, why should I
get that over your children in the future. Quite often, it replicates them both parties have got assets. And I suppose if I think about the stigma that we attach to it, there's a stigma to asking, but there's also potentially a stigma to not agreeing in that what you're doing this for the money as opposed to for the love, isn't there? When it works, once the question's been asked. There is. And it's not an easy conversation. There's only one that I've ever had that has actually kibosh the relationship.
where the proposal that, and I was for the wealthier party, who did have a lot of assets in that case, and made what was a pretty reasonable proposal, and his wife to be wasn't keen, and he sort of realised, well, hang on, is this, you know, is she marrying for the right reasons? Now, that's just once, and I do loads on loads of printups, so that's not common, but it's a difficult situation. I think one of the common causes of divorce is lack of openness about finances. I'm sure you see it a lot, Martin Thompson, I know you see it a lot.
And I think going into the marriage with the spirit of, OK, we've got this certainty. And frankly saying, if this were to come to the worst and we get divorced, I don't want to spend all our money on lawyers. I'd rather have an agreement and we can both walk on with a heads-held high in dignity and civility and know that we've done the right thing. I do get it all the time. It's generally the second biggest cause of divorce after infidelity. And actually, we're not talking about it, but I think financial compatibility is really important. And you talked earlier, Tamsin, about the idea that
Everything needs to be shared. There are methods of sharing, especially in this modern world where people get married later and they're used to financial independence. I tend to find much older people joint bank accounts work for, as in where you have one account between the two of you and that's it. Whereas for younger people, I tend to say you have your individual bank accounts and a joint bills account that you both agree to put money in.
And if there's an imbalance, a financial imbalance between you, one is a high earner. One's decided they're not going to work for five years and look after the kids, so they're off maternity. Then you have a payment that goes each month from the higher earner to the lower earner, but you don't just do it all in one account. And that's because psychologically,
We have different money personalities. Now, if you have a spender married to a saver and the saver is saving and the spender is spending their savings, that is even in itself without financial shortages, a cause of arguments. So I do think we have to be, money is not something that's just ancillary to relationships. And I talk about as well, we're not going to do it today, but don't just have one party who does the finances. You both need to understand it. You can have a lead party.
But then you have a financial fact sheet with everything written down without security details so that the other person could take it up if you got hit by one of the three days death divorce dementia. And you have kitchen table meetings and you discuss things so that the other person could take over if they have to I don't mind a lead. Funnily enough we may not be surprised i'm the lead financial party in my household shocking but.
I talked to my wife about it, we make decisions together so that if she had to take over, heaven forbid, she could take over. And that, I think the old way of doing it, which was basically pre-1950s, man work, woman stayed at home, looked after the kids. We live in a different world now.
Now, we've been talking about prenups and both Matthew and Tamzin are talking about the situation in England and Wales, but the law can differ in other parts of the UK. So I'm delighted to have on board Rachel Kelsey, who is president of the International Academy of Family Lawyers and is in Scotland. So Rachel, is the prenup situation in Scotland different to that in England and Wales?
Yes, it's very different. I mean, we've had prenups for hundreds of years. If you go up to the High Street, the Royal Mile in Edinburgh, you'll be able to go and see Flora McDonald's prenup from hundreds of years ago, the one who wrote Bonnie Prince Charlie across the sky. We are completely relaxed about party autonomy when it comes to
Preen up some what that means in plain English is if the two of you want to enter into a contract, whether that's before or after you get married, then we will uphold that and the courts will not then look behind what you have agreed as a couple.
Okay. We also have with us from Northern Ireland, Karen Quinn, who's co-director of PA Duffy Solicitors. Karen, what situation on prenups in Northern Ireland? The position of prenups in Northern Ireland is a fairly recent concept to hear. When I started out my legal practice, I would have been seeking the advice of council or barristers. Their position was at that stage where the prenups were ineffective. So it's really only in the last five, six, seven years actually. So very recent that we've really started using prenups and postnups.
and in fact really in the last number of years that we've been testing those and thankfully any prenups or post-ups that I've been involved in have been tested and have been found to be warranted but a very recent concept to us so very much unlike Scotland and I know certainly the England and Wales position they've been using pre and post-steps for a number of years but but very recent here
So rounding it all up and from all four of you, it seems like pre and post nups, well, not 100% guaranteed outside of Scotland are pretty strongly indicative these days that that's what will happen if they're done right. Yeah, I'd say they're heavily persuasive, they're more likely to be followed than not and the direction of travel.
is to make them more and not less binding in England and Wales. There's a number of consultations on potential changes to law to give them more of a statutory footing. It's a case law basis at the moment, but the direction travel is certainly towards more of the autonomy that you see in Scotland. And Matthew, we'll just do very quickly. I have been asked about pet knobs. Who keeps the pet?
So pets are chattels. That means they're basically free to date. Or etch akin to a sofa. It's slightly brutal. You can get a pet not or a possibly a pre-pupchial agreement if you really want or enter into some form of co-pouring thing after separation. But I'd encourage people to try and be sensible and pragmatic. There aren't any specific provisions in the law for pets. The whole thing sounds barking.
I'm going to move on to divorce in general. Sasha Potts. Is there an easy way to get divorced if you've been separated for five years, have no assets to split, no issues with custody finances? Both happy to get divorced would look just like to know the cheapest and easiest way. So the actual divorce and not being married part, the legal process is pretty straightforward.
It's largely administrative. You never have to set foot near court. It's all done online. You can do it yourself. You might want to speak to a lawyer. It might be a little bit confusing. Some people who are less tech savvy might want to get a lawyer involved who will generally do it for a fixed fee. So the actual divorce bit is straightforward. The second part of it, which is where my work comes in and what Tamsin advises on, is on a financial agreement. And those financial agreement will result in an order, a court order, normally a consent order, which is one that you agree to.
Again, you don't have to go to court. A lot of it's done online. If you can make an agreement, you can come to an agreement. What I'd always advise is even if you've got no assets, there's nothing to split. There's no property. It sounds nice and straightforward in this situation. What you should then get is a clean break consent order, which is a legal document which the court approves, which says you don't have any claims against each other as a result of your marriage or on death against the estate.
If you don't have that, there is no long stop date for claims as a result of divorce. 30 years later. I've done cases 20, 30 years later. So one of you wins the lottery 20 years later. Yep, so there was a famous case called Wyatt and Vince and basically the party separated in the early 90s and they didn't have a bean between them.
And then the husband went on and founded a hugely successful company, made millions and millions, and then I came back years later. And the court said, well, look, there is no long stop date. She does have claims. Now, it's not going to be as much as 50% or, you know, those sharing principles, but the claims exist forever indefinitely. And she had needs at the time she didn't have very much. Clean break order. And you do that yourself. Would you need a lawyer? It probably won't surprise you that I'm going to say get a lawyer for this, but I think it's really important to ensure you get it. But you could have said you have one lawyer to do that for the two of you.
So there are some firms who will offer, and this is increasing in popularity, a one lawyer, two clients service. So it's a new thing, not every firm will do, but have a Google search on it. And you can find a lawyer who will represent both of you. And if it's a very straightforward agreement with no disagreements and you can work for you, then you could get someone to do that acting for both of you. But normally it's one lawyer for each party.
A question from Parrog, I understand getting lawyers involved can be costly and competitive. Are the frameworks or tools out there to help direct and agree an amicable financial settlement in divorce? Now, Tamsen, you have been involved in this. I mean, there's alternative dispute resolution processes. How do they tend to work when you've seen them?
Yeah, absolutely. So there are a number of online services which can help both parties. They're not necessarily legal advice, but they are a structure in which the couple can go and speak to one another but with a third party there. There's also mediation.
So you have a mediator in the room if things aren't amicable enough for you to sit and have these discussions over the kitchen table and resolve them yourselves. You've got mediation. And the really interesting thing, I think, is even if you're having an amicable divorce, even if you're getting on everything, once you start coming to splitting the money, little things can rank up.
And having a third party, I mean, professional mediation is good, but even if you're not doing that, you know, a trusted friend who sits in the room just to referee between you can be helpful, because otherwise you can turn the amicable divorce into a full-blown fight, which is the worst thing for you. And if you've got kids, the worst thing for your children.
Yeah, absolutely. And I think the thing about professional mediation is there's a feeling out there that you need to have a mediator for the whole process to decide absolutely everything. You really don't. You can use a mediator to help you get over one particular bit of the, if there's a sticking point, if there's an issue, we don't want to share our pensions or one party doesn't want to share their pensions.
just go in and talk to have a mediator there for just that section of the process. You don't need it for everything. There are also various other types of mediation other than just one person sitting in the room. You might not want to be in the same room as your ex-spouse. There are ways of having shuttle mediation, so the mediator goes between the two people. There is
I think it's called hybrid mediation, but you can correct me if I'm wrong, where the mediator can keep confidences between the two parties. You can have lawyers sitting there and you can also have a mediator going to talk to the children of the couple. So loads and loads of options. That's for mediation. There are also other
Other options such as arbitration. Maybe I'll go to Matthew on this. Yeah, it sounds like there's a whole call you cope with different things you can do. Where do you start if you don't know what to do? Where do you go and do your reading? Where would you point people in the first instance? Relatively amicable. Not necessarily going to have a fight, but want to get divorced. Where would you send them?
I mean, there's loads of free online information. So I'm going to plug my firm, Stowe Family Law. There's lots of free resources on there. I'll give you one plug. Thank you. My marketing team made me get that in there. So there's free resources on there. There's loads of good books. There's a book called Almost Anything But The Family Court, which is a really good guide for people to keep things happening on that as well.
Yeah, so it's a really good book by a lawyer who works in exclusively in non-court dispute resolution. What I would say, though, is that I think lawyers have got this perception of always inflaming things and driving up the temperature, and I can't lie and say that doesn't happen sometimes. But the vast majority of lawyers will do their best to keep things out of court, very rare we had off to court as a first blush, very, very rare in only in extreme circumstances. We will normally encourage people to speak directly.
How much can you sort directly with your spouse and then come back to us for the fiddly bits and do the legal drafting? If they're talking. If they're talking. And that's a big if. And not everyone can do that. And sometimes you need to be that interface. And sometimes there's abuse cases where it's just not appropriate to do that at all. Well, I'm going to move on to that. Josephine now, not her real name.
Separated waiting for a divorce due to domestic violence, being granted the right to divorce through the court but waiting for the partner to continue the application. Tried ringing to courts to see where this is, but up to 60 minute wait time in the court queue. Not allowed contact, how do I make sure he does this? Can I do the divorce if he originally started it? It's obviously sounding quite a desperate situation there.
Yeah, really tough, really tough. If you're the respondent in divorce and yes, you can push things along. It depends what stage this lady's up to and there's different options to do it. I would say that the court service is hugely overburdened. So trying to get a response out of them is going to be difficult. But there are timeframes where if it's not put in progress beyond a certain point, a respondent can step in and push things forward. The system relies in general on a willing applicant or if it's a you can make a joint application for divorce because we've moved away from the
or reasonable behaviour in adultery and all that nonsense that we used to have to do. And you can do it civilly and both do it and then you drive it forward collectively. No fault divorce. So that makes the system a lot better, but there's always going to be people who are difficult and it depends on what stage you're at, but yes, you can drive it forward. One from the weasel, what if X refuses to sign the paperwork?
depends what paperwork it is, you can make certain applications to court for an order that someone signs a specific document and there is a provision under statute which allows an order that if they fail to sign that paperwork then a nominated person can sign that paperwork on the behalf of a judge or a lawyer or someone if they don't sign the requisite paperwork within 14 days, 28 days.
I'm going to do one last question on sort of the process of divorce. Now, I've got Anne here who says, and I think Tam's in this maybe for you. What can you do when you're desperate to divorce? Currently separated, but living in same property as X won't move out. Can't afford solicitors. X won't sell until charges 18, which is five years away. Can't get mortgage on my own due to a shared debt. I think this is more a life choice than a legal situation issue. It's hard, isn't it?
Yeah, it's very hard. I've got clients who have had to continue to live in the same property but us essentially separated and in some cases it's even down to one of them sleeping on the sofa. It's a really, really difficult situation. I guess a couple of things. One thing is, is there any possibility of borrowing something from friends or family
or going to stay with friends or family just as an interim solution because it's often really, really difficult to stay in the same house. And I would say that a lot of really brilliant family solicitors will offer you a brief half hour free consultation which might just help to have that information that you can gather from a legal family solicitor.
And also to say that the citizens' advice bureau might be able to help with certain information. And if you're having to consider court proceedings and you can't afford a lawyer, there's a brilliant organisation called Support Through Court, which is a court-based charity. I would echo support through Court as a print organisation. I should declare I'm a patron and a funder of that charity. So I think they're very good. Well done. I'm glad you mentioned it because I couldn't.
Now we're going to move on to splitting assets, which is where it starts to get a little bit tricky. Let's start with a conceptual one from Flossy. Why is someone who came to the relationship in massive debt together 10 years married? Why are they entitled to half your savings? Why? That's what she's asking.
I mean, that's a good question. So I think that fundamentally, the system for dealing with finances on divorce is designed to achieve fairness. And fairness is going to look at very different things to very different people. Just to take a step back, the process that broadly speaking, you go through is that there's two concepts in splitting finances. There's the sharing principle and there's the needs principle. And the starting point is that assets
not income, but assets should be divided equally if they are matrimonial. So they've arisen from the marriage or during the marriage. And then you might depart from, so that's the add up and divide by two parts. Then you might depart from that equality for various criteria, but most common one is for needs. So a party's reasonable needs for housing, for capital, for pension. And the most important thing is the needs of any minor children. So if you have a primary carer,
make sure that they've got a house for the children. But equally, if the children are spending time with both parties, then both parties should have a similar sort of house. That similar sort of house is bigger than it sounds, isn't it? So, for example, let's do it in the extreme because it makes it easy. You've come from a huge family, expensive family home. Therefore, the partner who's moving out, if they have the children, should have a similar level of home. Is that correct? The first one?
One, how does that work? Yeah, I mean, the way I describe it to clients is the court wouldn't want to, and when I talk about the court, it's the prism through which we look at things. It's not saying that everything's going off to court, but the court doesn't want to see mum and a castle dad in the shoebox. That's not right for the kids. They're not going to like that. The kids have to be able to have a home with both. Even if they're only spending one night a week with the other parent, they've got to have a reasonable house. So, is the need for a house that replicates the standard of living during the marriage?
But look, most people can't do that. That's only the 1% who've got sufficient money on a share in case where there's surplus cash at the end and they can both have one of them can keep the house and one of them can buy a similar house. So you're looking at how can you slice the pie, taking into account the assets and mortgage capacities of the people, to then allow both parties to rehouse so that
a couple with two kids, a boy and a girl can have a three bedroom house each that they're going to need. How do we do that? Can we do that? And if not, what's the best that we can do with those resources? So that's going to be the general approach with Flossy's case. And it will depend when the savings come up. If this pot of savings existed before the marriage, you may be able to argue that with the lawyer,
You'd need a lawyer to argue. Probably. Probably. Yeah. Well, because it's probably not going to be heard by the other party, who's just going to say, well, it's 50-50. But it may be that you can say this is a non-matrimonial asset. I had it before. It's not been mingled, not been mixed in with the matrimonial finances. So therefore, the importance of that is the sharing principle doesn't apply.
It can be invaded to meet needs. So someone can have a shit, a part of it if they need it, but they don't get a share of it automatically. I can hear there's a big question marking your voice. Yeah. Well, that's what you're doing. Your money, isn't it? Well, this is, it's so fact specific. Yeah. I'll show you in your money all the time. Thank you. Very kind, very kind. But these are the cases where you need the lawyer advice. They're not clear.
Let's move on to another one. We have a question from Twitter here who I'm going to keep anonymous who says, if I inherit say 200,000 from my late mother and father, is my marriage partner entitled to 50%? If so, is there a legal way around this as my father script and saved his whole life and doesn't like my partner, so doesn't want them to have a penny further on in the discussion that there's domestic abuse going on in this relationship? I need to note before people go on about the issue there. So let's take it on its
principle core, can an inheritance be protected from the matrimonial assets after marriage, if the inheritance is coming after marriage? Is it a post-nop? Is that what a post-nop is? A post-nop would be really useful. So this is the exact circumstance where you want to post-nop. Now, the problem with a post-nop is that you can't force it. And if someone says, I'm not signing a post-nop, you're slightly up a creek. Well, with the pre-nop, you can say, well, either you sign the pre-nop or we don't get married.
But a post not can be really useful. It sounds like, let's say he or she is not doing it, not post not happening. So what are the options? So there are some things you can do to help you. So there's no guarantees with this, but inheritance, the starting points that inheritance is non matrimonial. It's not been generated by the marriages. Come from an external source, it's non matrimonial. So therefore, the starting principle is, well, the sharing principle doesn't apply.
However, if you then mingle it, so mingle it is when you mix it in with the finances of the marriage. So commonly, if someone receives an inheritance and then pays off the mortgage, it gets mingled in the family home, which is the most family assets. And I would say that. No family assets. I mean, you would say that does natural usage, wouldn't you?
you would, you would. And therefore your ability to claim that that is should be ring fenced and kept separate is very, very difficult. If however, you receive it, you put it in investment, you don't touch it. Maybe you draw off the income, but you're not using it in general. And there's a real clear paper trail, which says it's never been part of the marriage. You can then run an argument, which says, well, it's not available for sharing because it's not matrimonial. They might still get a bit of it to meet their needs if there's not other resources, or they might get more of the matrimonial resources.
Would a letter in the expression of wishes form in the will have any bearing or not at all? Not really, not really. The family court's got quite extensive jurisdiction to overreach that sort of intention. I don't think it would necessarily hurt if it came down to a real constructed argument about intentions on mingling, but it's not going to be determinative.
So it sounds to me like that this is quite a heavy legal issue if you're going to try and do this. You're going to need, you're going to need meaty lawyers to have a go. I think so. I mean, I don't want to overstate it in terms of the meatiness. It's a fairly common issue that comes up and it's something that I'll often talk about in an initial meeting before having to wade into, you know, huge instructions and people getting terrified about spending huge amounts of money on lawyers. You know, you should get a guide from an early stage from your lawyer about whether it's worth spending the money to fight this because we'll be able to advise on that.
Tamsin, could you use a trust of some variety as part of the inheritance element? Could the inheritance go into trust to protect it? Yeah, absolutely. So the parents would be the people who would arrange this as part of their wills. It could go into a discretionary trust.
It was always thought by financial advisors going back many years. It was what I was always taught was that discretionary trust would be able to keep assets out of marital assets and protect them in divorce. More recently, having started doing this work, I've discovered that's not entirely the case. So I probably want to bring Matthew in at this age.
Let us know what the score is. Yeah, I mean, as ever, the answer is sort of it depends, and the huge caveats that everyone would expect from a lawyer. But when you're dealing with trusts, without going into too much detail, if it's a nuptial trust, so something that has been created for the benefit of the marriage, that's a shareable resource.
If it's not in nuptial trust and it's something created separately, you're less likely to be able to invade it and attack it, subject to certain principles applying. What I'd say is that's quite a niche specific area and that you should certainly ensure that you instruct a really good lawyer to draft the trust, but also run it by a family lawyer just in case there's an issue. Sometimes you use trust at the same time as post, not some pre-nups, there's double protection.
Rachel, are there any differences in Scotland to what we've just been talking about on both the trust and the inheritance and separating matrimonial assets? Yes, there are some differences. I think it's interesting when Matthew talks about
sort of it depends. For us as Scottish lawyers, we don't have as much of that sort of it depends because we have a much more structured approach and so if you inherit something during your marriage and you still have it when you separate that is not matrimonial property and the other party will not have any claim on the value. There is an extent to which when Matthew talked about mingling things, so if you take an inheritance and use some of that to pay off the mortgage,
I suspect you're not going to end up in a very different position in Scotland than in England. But if you get something and you keep it, it is not to match from new property and there is no claim on its value. And Karen, how about in Northern Ireland? How does that work? The position would be broadly similar in England and Wales to Northern Ireland. I think there may be some discrepancies between Northern Ireland and Scotland. My understanding is that perhaps the issue of pensions in Northern Ireland is somewhat different than the other nations.
We're going to come on to that pension section. So we're sort of seeing a division here between Scotland and the rest of the United Kingdom in the law. Another question here from Twitter, when it comes to spitting a business, how do you ensure that it is based on potential earnings?
So there's basically two ways to value a business when you're dealing with a divorce, you've got a net asset value or an earnings basis. Net asset value is effectively what would happen if you sold everything, paid off any debts and what the cash is that would be left and you would commonly use that for a property holding company, something where you're generating the income from the assets.
for any kind of trading company. The preferred approach is for the earnings basis. And the way that works is you need to get forensic accountant normally who will value the business. It will calculate the EBITDA, so earnings before interest, tax, depreciation and amortization. And then what it does is applies a multiple.
And that multiple is sector specific, so it might be three, it might be four, it might be eight, it might be nine. To work out based on the industry, what the total value of the business is projecting in income of the following few years. Then there's a few little tweaks. And that's what multiples do. Multiples are about future valuations rather than current valuations by definition, aren't they?
Exactly. So you're looking at the snapshot value now and then the multiple based on the likelihood, which is based on a history of deals in that sector. You might need to then adjust for tax and liquidity and all these sort of things, minority share holding discounts, but generally the court would always prefer earnings valuation on a trading company unless it's something like a property holding business where in that asset value is absolutely fine. This one from Michelle. What are the capital gains tax implications after divorce years ago, but no financial settlement? Is it on the 50% of the increase?
Or can there be a lower percentage split once one party has a new home as the second person that hasn't contributed anything in the meantime? In effect, paying on 50% would leave the first party with not enough for a new home as the second party share would have to increase to cover CGT. So basically, what I'm gathering is they've split up. One's got a new home, but they're both still liable for the original home, but only the other person is the only one who's been contributing in the meantime. Is that taken into account for the capital gains tax?
So it depends, sorry. It's a phrase of the party, it depends, yeah. Absolutely. And it's the one thing that I learned when I started doing divorce work was that all family lawyers are going to say it depends to everything. But in this case, it depends on which house the person who's got a new home has designated as their principal primary residence.
That's a really important bit. Have they designated their new home as the principal primary residence or has it remained with the original home? And that's how we decide as to whether this capital gains tax or not. In terms of the 50% or the split of the family home, again, that depends on what the agreement is going to be between the two of them. So they probably need legal advice.
or mediation, or some sort of discussion between the two of them as to how that property is going to be split. Now, if one of them is remained in the home, paid all the bills, continue paying all of them, all of the mortgage. Since divorce. Since divorce. I would suspect there will be an argument to put and more of the capital equity from the original family home to the person who's remained in it.
And I presume the sensitive force is a crucial factor, Matthew, that they're now divorced, so it's not matrimonial assets anymore. Possibly, probably, maybe, as ever. I think it depends on the ongoing contributions. I've had cases where a departing party has continued to pay to the mortgage, and there's no departure from equality. If someone is making sole and match contributions, it seems right that that would be factored in, in terms of the CGT. Yes, that's going to depend on the circumstances at the time. If there is going to be, however,
And of course HMRC's decision may be totally different to a family court's decision. Yes, although there was a change in the CGT regulations on divorce in April 2023, which means that as of that date, any transfers between couples within three years of the date of separation, now that's not divorce, that is separation. So leaving the family home or sometimes even separated in the family home within three years or on a nil gain, nil loss basis for CGT.
Then on top of that, any consent order that includes a transfer of a property is at a nil gain, nil loss basis, no matter when it's done. It's nil gain, you don't pay capital gains. You don't pay capital gains tax at the time, but someone on a transfer would then inherit the other party's CGT share and at a later point of liquidation would have to pay that. So that's why it's important that you do the sums, you get the accountancy advice on what the CGT is, and then you factor that in, even if it's not
immediately payable, which obviously helps people on the transfer, because there's no cash being realised to pay a CGT bill, but it kicks the can down the road somewhat. Now, my last one on this section, I think is almost definitely and it depends, but I think it's worth talking about. It's fairly safe bet on most of these questions. It's worth talking about on principle, because I can hear the fear. This is coming from Sharon.
My husband and I separated, not legally, but he moved out 18 months ago, still on great terms, good, nice to hear. We still pay both of our bills through a joint account, but our family home, which I live in with our two adult sons, is still in both names. If we divorce, will I have to sell it?
I mean, by definition, you wouldn't, would you? I'd say no. I mean, that's a clear, you don't have to sell it. You might decide that that's the best course of option and that could be ordered if there's a dispute. But a lot of cases will be settled by someone retaining the family home and giving up other assets, whether it's cash, whether it's investments, whether it's pensions, which has its own question marks about whether you should do that. But the sale of the family home, it often has to be the case, but it doesn't always.
I'm going to do a quick question on mortgages, then we'll move on to pensions, which has been coming up a lot. And I think it's one of the biggest, most complicated areas here. So probably the times in this one is from Bali. How do I get someone off a mortgage? You need to apply to your mortgage company. So whoever whoever the company is that provided the mortgage to you, you need to apply to them for what's called a transfer of equity. That essentially is saying,
There were two of us on this mortgage, now there's only going to be one. The mortgage company will fully underwrite that mortgage to ensure that you can afford it on their affordability criteria. It won't necessarily mean a change of product, so you can probably keep the product that you're on, but you will need to be able to afford that mortgage on your own in order to remove the other person.
You also will need a convincing solicitor to remove the other person from the deed of the property because if they're on the mortgage they will also be a part owner as well. And you will need the other person's permission. You can't just do it without them knowing.
Okay. I'm going to move on to pensions. I think it's probably worth getting Matthew, England and Wales, Rachel, Scotland and Kieran, Northern Ireland, to answer in turn. Now, I'm hoping that the term pension sharing order is common in all of them, but let's talk about splitting pensions and a pension sharing order. We'll start with Matthew again. We'll lead that way. Okay.
So pensions are an asset of the marriage like any other. If they've been accrued during the marriage, they are matrimonial and they are available for sharing. And I think psychologically pensions are quite difficult for people to handle. It's pretty clear that the family homes are family asset because you live in it.
Your pensions attach to your pay slip, and often people don't think about it or ignore it, and it's in the future. And think, well, why should that be? I've been working. Why should that be shareable? Obviously, in most cases, there's some sort of salary sacrifice, which would otherwise be coming into the marriage. So that's the genesis behind it.
pensions are dealt with commonly by pension sharing orders, which effectively means that one party can have a percentage of the other person's pension to provide them with the pension. So if one party has £200,000 in capital value in the pension and the other party has nothing, it might be a 50% share, so they both end up with £100,000 in the world's most straightforward example.
There are all sorts of complexities with it. You can trade off pensions against other assets. The way in which pensions are valued is really a big big point and something that really needs advice and people slip up on all the time when they're done. So it's a lot easier. If you've got a money purchase pension, which is where you've got a pot of cash saved up in your pension, I think valuing that is relatively straightforward. Yeah.
Yes, so we work on... Although Tams is about to make it less straightforward. Only because there is a caveat, some money purchase pensions have guaranteed annuity rates, some have protected tax-free cash, so more than the 25%. So both of those two, they've got extra booms on top of just the straight cash, so they would be valued higher because of that. Absolutely.
and then you've got what defined benefits, but we'll call them final salary pensions, which are more commonly known by, which are a nightmare to value in any case, because really difficult to output, and that's a presume where it gets really complicated. That's where it gets really complicated, and the values that we rely on in divorce are called C-E-T-E-E, or C-E's cash equivalent transfer values, and the valuation of a, to put it in simple terms, if you've got a money purchase scheme with 100,000 pounds in it, and you've got an NHS scheme with 100,000 pounds in it,
you can be assured as you can be that at retirement you will receive a greater income from the NHS scheme than you would from your money purchase scheme. So it's for comparing apples and oranges. So that's when you need actuarial advice to advise on how they can be split, how they can be separated to arrive at a percentage where the person with the lesser pension provision can receive a percentage from the greater party. And what that means
is that at the point of divorce, or when it's implemented following the divorce, is you received. So if Tamsin was taking 25% of my pension, she should be so lucky. You just married without me knowing. I know, well, we thought we'd come with things. We're like a gooseberry in this room.
Next example, I'll involve you if you like. Thank you. We can be married. That's fine. Yeah. So if Thompson takes 25% of my pension, what it means is she gets that 25% into a scheme of her own under her own name, and that then operates according to the rules of that scheme. It can be the internal transfer in the same scheme. It might be able to be an external transfer elsewhere. She can pay into it. She can take it at 55, 67, and I can carry on paying into mine without inflating Tamsins in the future.
So how would that work just to push on and then we're going to come to Scotland and Northern Ireland here? How would that work in a final salary pension that Tamzin has never been an employee at? Could she be in that scheme or would she just, how would you give up the portion of your pension from your pension?
But yeah, most in most of the final salary schemes, most of the big public sector schemes will kind of force internal sharing. So it means that Tamsen is effectively working for the NHS or the armed forces or the police. So you could have, if you were a doctor, she, Tamsen could then have an NHS scheme in there. She's never worked for the NHS.
Yeah, carry out again, sorry. It depends. Non-public sector, so private sector DB schemes, which are becoming fewer and far further between, but those of, it's very rare that you can become a shadow member. So you would have to do an external transfer into a personal pension of your own. So you would then going, one party would have a DB scheme, a final salary scheme, the other party would then have a money purchase scheme.
So we have different balances of risk, but hey, nothing's perfect. No. Yeah. And that's the news we can do. Let me, I really want to go to Scotland here at Rachel. Does pension splitting, if you like, work differently in Scotland?
Of course it does. We're back to the same point which is that we don't like to overcomplicate things and we give priority to certainty which does sometimes mean that you get outcomes which English lawyers don't feel are as fair and pensions as a good example of this.
We have differences in valuation, so we also use the CETBA cash flow transfer value. We calculate that at what we call the relevant date, which is the date that the couple separate. The critical difference here at a practical level is that we very rarely use actuaries and we don't go behind the CETV figures that are given. We have a statutory basis for those and we get that figure and that's what we use.
the other difference that we see. So I'm just so just so I understand. So effectively in Scotland, there's a there's a formula. And in England, it's arguable due to actuarial estimation. So one may be beneficial to one party. The other one is more obviously transparent in Scotland, it's more obviously transparent at start. Exactly. Exactly. And then the other main difference that we see at a practical level is
In Scotland, you can have pension sharing either by way of percentage, as has been mentioned by Matthew, but much more commonly, we use a fixed share to a specific amount. And we can do that contractually. You don't need a court order. You don't get a court order.
you have a contract which is effective, they're posting up and where you agree that a particular amount of money will come from someone's pension fund and go to another fund to the other person. And again, the reason we do that is because we have a much more formulaic approach to things and we are simply offsetting the value of one asset against another. Now,
That does bring real challenges because as was touched on a moment ago, the real value to somebody of a pension, it may feel very different from you can get the same figure in a money purchase and the same figure in a, you know, if it's an army pension, for example, whereas we simplify things and we take that figure. So when we're doing that offsetting with a fixed amount, you really want to get good advice about what that is going to look like in the long run for you.
Does that also cause issues that, if you split the pension, then both parties can decide when they take that money, when they take that pension. But in the system where you're just getting a set amount of money from the pension, how does it work if they have different timing priorities of when they want the pension money?
Well, again, the Scottish approach is very much about a clean break. You are separated. You then go on to divorce and you do what you want to do. And that's where you need to be taking advice about, do you stay in the scheme? Is it an internal and external transfer? That's the same.
But then what does that look like for you in terms of your own particular profile, then what other income you've got, what tax you do to pay, what age you're working at and so on. The basic position in Scotland is it's much less paternalistic. It's much more party autonomy. You have freedom to contract as you want.
you need it's on you to check that you're not getting a bad bargain. And Karen, I feel like I should say, and Karen, have you got the results of the Northern Irish jury? Neil Poi. So how's pension spending in Northern Ireland for us, please? Yes, well, my understanding is that pension spending in Ireland is much more common than perhaps in England and Wales. Perhaps one of the large contributions towards that is because we've got a quite a high percentage of people working in the public service in Northern Ireland. In fact, my understanding is this is the
biggest reason for public service work, maybe something in the recent of 27, 28% of our population work in public service. And so on divorce, it's always a big question is the pension. So what we quite often look to here is equalizing pensions during a marriage. We look to, you know, accruing the pension that was looked to the figures accrued during the marriage period. So if we have a someone who's been working in the public service for 20 years, say, for example, and they have been married for 10 and we look
to that 10 years where they have been married and try and see if there's an equalization between them and their spouse in those circumstances. It does get quite complex. We quite often involve use of actuaries to carry out calculations, especially because quite often those pensions can be worth more than £100,000. So we then look to pension sharing orders in many occasions, and then also look towards pension offsetting.
So it's actually sounding a bit more similar to the English system. Scotland seems to be an outlier on quite a few of these different areas. Or an outlier, it seems to be setting the trend, whichever position you want to look at. Thank you very much to both of you on that. I'm aware I'm running out of time and I want to do some issues regarding children. So I'm going to do them in here and then we'll just come and see if there's any Scotland Northern Ireland issues at the end.
What if you make a settlement based on a child custody agreement, this is coming from Twitter, anonymous, i.e. 50% split time, but then the custody ratio changes. What happens there, Matthew? Capital agreements are not capable of variation other than in fairly extreme situations, so if you've decided to split the equity in the house, 6040, that's it, you're stuck with it if things change.
In terms of there are two possible ongoing payments, spousal maintenance and child maintenance, both of those remain variable and can adapt to meet the situation either through the formula of child maintenance or through the court process in terms of spousal maintenance.
Next question, Joe says, what if any financial obligation can be sought on a parent for university-aged children when loans etc aren't enough to cover living costs? e.g. I have two kids at uni that I'm trying to support. Their dad won't help. I can answer that one actually. Under the law, the maintenance loan that is assessed when you go to university or maintenance loan and grant when you're outside of England in other parts of the country is an assessment that is effectively based on a parental contribution because it's on household income, but
the government says it can be funded in any other ways included the child working so the the student cannot force you to make up at the gap in the amount that they have lowered on the loan so the concept that you're asking their dad won't help well you don't have to help legally either it is
It is a hidden parental contribution. It's only in the last two years. They've said that there is a parental contribution because I lobbered it on it for a decade. And we finally got them to admit that it is effectively as it's based on household income. The amount you get on the loan has an implicit parental contribution, but it's implicit. It's not explicit. It's not legal. You can't force it. There is one possible claim.
not by the parent against the non-resident parent, but by the child themselves. On the schedule one to the children act, a child who's over the age of 18 can make a claim against a parent for provision for university fees if there wasn't a child maintenance order in force prior to that child turning 16. It's pretty niche, but the child can make a claim themselves.
fees or university maintenance? I think the court could construe that relatively widely, include some general capital or it can be constructed as a capital payment or as ongoing maintenance. So you could construct it on the basis of support while at uni in addition to fees.
Okay, so under the university element that I'm looking at, there is no way a child can mandate a parent to contribute even though it is based on a household assessment of income and the means testing, but you may be able to do it in divorce. Maybe else do. Well, that wouldn't be a divorce. That would be for... You don't have to be married. It's on the Schedule 1, the children act, so it can apply to anyone who is a parent. It's for the child themselves to make the claim when they're over the age of 18. I would love to see a test case on that. Do you know if there's any more? There is some case law. They don't come up very often.
I'd like, if you fancy forwarding me some more information on that. I will, I will dig out some case. I think that's going to rattle Middle Britain. Rachel, does that happen in Scotland? Is it different in Scotland? I mean, the maintenance situation in Scotland is there's a smaller parental contribution because you get a mix of a loan and grant, but so the total amount you receive
compared to the full loan, the difference is small than it is in England. Are there any differences in the law in Scotland on maintenance support? Yeah, I mean, the main one is in Scotland, individuals can make a claim after they're 16, so we become adults at 16 in Scotland. And as a young person between 16 and 25, you can make a claim against not just a parent, but also anybody who accepted you as a child of their family, so a step-parent,
And that's not uncommon in Scotland and we've done that for quite a long time. And you could do it for university aged children 18 plus. Yes, 18 to 25. And it's not uncommon. It's really not uncommon. I would love to see these cases. Very exciting. I'm going to move on to James now, which is a changed name.
How is it allowed for a mother to turn the children against the father and the mother to refuse to allow contract or even pass photos of them onto the father? How can a court rule this is acceptable just because they are in their teens and too scared to go against their mother? Now I've chosen that question.
because we had quite a few of a similar vein generally from angry fathers who have been denied access to their children and we know that this is a societal issue and the way people feel about it. Matthew, just give us the court's general view, not your view, it's for how you interpret what the courts do.
Sure, it's an incredibly difficult issue. So what we're talking about here is alienation. Parental alienation, which is where one party ends up alienating the children from another party. They're incredibly difficult. It's an argument that's run fairly frequently and actually it's kind of found fairly rarely and there's some difference as to whether the courts are dealing with it properly or whether it's a slightly exaggerated issue and actually it's a real rarity that alienation exists.
What I'd say is the court doesn't endorse it and I don't think the framing of that question is quite right. The court is never going to say that's acceptable. It's okay for a parent to do that. What the court has said in a couple of very extreme cases is yes, there has been alienation. But when the court's looking at children, its paramount concern is the welfare of the individual child.
not the parents, doesn't care about mum, doesn't care about dad, just cares about the children. And if the impact of breaking that alienation, if a child genuinely believes that their parent has been abusive towards them, forcing that child to have contact with that parent would be a continuation of that perceived abuse. So that wouldn't be in a child's best interest.
So that's a really, really, really rare case. The flip side to the alienation argument is quite a lot of people, quite a lot of parents will argue there's alienation when actually sometimes children just are resistant to contact for very good reason often when there's abuse in the background. It's an incredibly thorny and naughty area. And I think it's one where the courts still developing in a lot of ways is very fact specific, but it's really difficult for the court to get behind it and often to find out the genuine truth of these allegations.
Thank you very much for that. Yes, it is difficult. And just to say to the listeners, I'm aware we haven't talked about the child support agency. I know we've got some questions because we're focusing primarily on divorce, and that is a slightly different issue, which would need a different panel to do it. So I haven't done it in this program. I have it in my notes as something I may well do in the future. Before we finish, just to give the panel the morning, I'm going to ask all four of you,
for your one thirty second tip on marriage or divorce that you would like to get across anything we've missed is really what i'm looking to cover here let's start in Scotland with Rachel just be nice. Is that about me as a presenter i appreciate no i think my top tip would be to talk about money before.
you move in with each other and or get married. We have rights for cohabitants in Scotland that you don't have in other parts of the UK, for example. But what we see over and over again as lawyers is that people have not talked about money and their attitudes to money. And a bit of that before you get swept away with everything else would not be a bad thing. And let's do Tamsin now.
Okay, so being the money person, mine's going to be related to pensions. So there is a fabulous guide. It's available at advicenow.org.uk forward slash pensions. It's called the survival guide to pensions on divorce. It is essential reading for anybody going through divorce. It will explain pensions to you, explain what your options are relating to your pensions and hopefully help you to understand
a little bit about pensions when you're getting divorced. Matthew, I think my advice is that if you are divorcing, if you are separating, you need to be aware that it's a zero sum game. It's that the money is not going to inflate. It is not going to increase. And the more that you spend on lawyers, the more that you instruct your lawyer to write correspondence on issues that you're unhappy about with your spouse, the less there is in the pot to split.
So much of it comes down to attitude. So much of it comes down to the final answer in most cases is something that both parties don't love but can live with. And it's an element of pragmatism and being sensible and trying to retain your dignity is the best way to deal with it on the human level, but also to ensure that you retain as much of the family finances as possible without putting them in lawyers' pockets. And we'll go to Kieran, who I believe you're actually at the Titanic Center in Northern Ireland is where you're calling us from, which is arguably slightly relevant if we're talking about divorce, isn't it? So what's yours, Kieran?
Well, my advice is very simple. The process itself is incredibly simple, but be difficult by the personalities involved. Once you agree that you're going to go your separate ways, the process of discovery, discover all your assets, agree what there is, agree the split and get on with it. Not advice probably is to the financial detriment of the lawyers, but the process is simple. And I think if you can take the nastiness out of it, then it'll eat a much easier process for everyone.
I was going to give a sort of a big nice Jerry Springer summing up about marriage and being nice. But as that's been done so beautifully by our four contributors already, might it will be once you do get divorced, go and check your expression of wishes or your nomination form on your pension. Remember pensions don't go in your will.
So if you have nominated your ex to be the recipient of your pension, unless that's changed, that will be what the pension company is looking at when you pass away. So it's not always not binding, but it is what they'll look at. It's a lot easier if you go onto your pension firm's website or go and talk to them and say, I want to change my expression of wishes also called a nomination form and change it that way.
I'd like to thank. I've really, really found this interesting and educational. So thank you so much to Divoslo and Matthew Taylor from Stowe Family Law, Independent Financial Advisor, Tamzin Cain from Smart Financial Planning, Rachel Kelsey, President of the International Academy of Family Lawyers, and Kieran Quinn, co-director at PA Duffy Solicitas. I hope you've all found it really useful. Thank you.
That's it. I hope you enjoyed this special edition of the Not the Martin Lewis Podcast. If you did, please tell your friends. And remember, my normal The Martin Lewis Podcast is out every Wednesday, so do hit subscribe. And if you want to listen to more of the Not the Martin Lewis Podcast, well, there's lots of them that we've done. Renters rights, can you challenge a rent hike?
Will you pay inheritance tax? Pension needs to know how to get money out of your pension and what you need to know about tax itself. Have a listen back to some of those. You might just find them useful.
Martin Lewis is the founder of moneysavingexpert.com, but other consumer and price comparison websites are available. You can get in touch with Martin's podcast team by emailing martinluispodcast.bbc.co.uk. The offers and rates mentioned in the podcast are correct at the time of recording. However, if you're listening on demand, it's worth double checking as the details can date.
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