Divorce and your pension

You and your partner will need to consider how to treat your pension as part of any divorce/dissolution settlement. You may also wish to get legal advice from your solicitor.

In the event of divorce, dissolution of a civil partnership, annulment or judicial separation, a court may order a pension scheme to pay all or part of your benefits to your former husband, wife, or civil partner. The details would be set out in either an "earmarking" or "pension sharing" order.

An earmarking order can apply to all or part of your pension, lump sum, or even your death grant. If you have already retired, the order may require immediate payment of pension to your former partner. If you are an active or deferred member, the order would not have effect until you take your pension and receive your lump sum.

A pension sharing order has immediate effect. It will say that a percentage of your benefits should be deducted to give "pension credit rights" to your former spouse or civil partner. They will then become a “pension credit member” of the scheme in their own right.

The pension credit benefits remain in the scheme until the pension credit member is eligible to draw them at age 60. If they have already reached that age then they will be put into payment immediately. The pension credit member is able to convert part of the pension for a lump sum unless you have already retired and taken a lump sum before the pension sharing order takes effect. The benefits cannot be transferred to another pension scheme.

If a pension credit member dies before age 60, a death grant would be paid to their estate. There are no survivor benefits attached to a pension credit.

The court normally needs you and your former partner to provide information about current and future pension benefits along with the rules of those pension scheme(s). Your FRA or their pension administrator can give you this, as well as general information about the impact an earmarking or sharing order may have on pension.


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