Pension sharing: two bites of the cherry
A pension sharing order (PSO) cannot be varied at a future date. In addition, if you are awarded a PSO from your partner’s pension you cannot apply for a second PSO for the same marriage on the same pension. It’s therefore important to ensure you take good legal and financial advice during your divorce negotiations. If an error is made the PSO cannot be adjusted, and you do not get an opportunity to ask for additional payment in the future.
However,you can apply for a PSO at any time in the future to vary maintenance. One point to be aware of is that if your partner has a number of pensions which have had a previous PSO against them, but are at a later date are consolidated, the new arrangement can be challenged. You can apply for a PSO against this new arrangement, to capitalise maintenance.
As an example, assume your partner had a pension with both Prudential and Friends Life, and you received a PSO against both arrangements. Whilst the funds are with Prudential and Friends Life neither pension is available for any future share in respect of your divorce.
However, if at a later date the 2 pensions are consolidated into a new arrangement, you can then ask to capitalise maintenance by obtaining a PSO on the new arrangement.
If you are the spouse with the pension funds and your partner is seeking a PSO, my advice is to consolidate your pensions pre the PSO, and apply the PSO against the new arrangement. That will ensure you safeguard this pension against any further sharing.
If you are going through divorce and would like advice on your finances please call me for a no obligation discussion on 01932 698150.
photocredit:flickr/tanakawho
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