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
Read More
If you enjoyed this post, we recommend the following as additional reading.
ISAs explained: limits for 2013/14
What is an ISA? ISA stands for Individual Savings Account. In an effort to get us all saving as much as possible the government gives tax advantages when saving into an ISA. There are limits set each year as to what amount you can save in an ISA and receive tax benefits. Ordinarily if you…
What if you’re a stay at home mum and getting divorced?
It’s easy to think that you’ve stayed at home during your marriage bringing up a family, whilst your partner has gone out to work, that this will impact on the financial settlement you will receive when you are divorced. Since the partner who worked earned the money doesn’t it mean that he gets a greater share of the matrimonial…
Would you be happy to throw away your money?
Now of course we all know that if I asked this question directly the answer from everyone would be “NO”. And probably you would think that I was even mad to ask the question. And yet, I often see this being done by my clients. I am dealing with a client now who received a…