Pensions and divorce

Pensions and divorce doesn’t need to be complicated. Here we provide some technical support to help you have easier conversations with your clients.

Watch our webinar

Clare Moffat, Head of Business Development at Royal London, talks about: *

  • the challenges faced in pensions and divorce
  • the impact of pension freedoms
  • how you can help your clients and solicitor connections

*this webinar was recorded on Monday 12 November 2018.

Read our top five questions

  1. What can the ex-spouse/civil partner do with a pension credit?

    If the scheme does not allow the ex-spouse/civil partner to become a member, the transfer value can be paid to a personal pension. If the pension credit is coming from an occupational scheme, a Section 32 will also be an option.
    The value could also be transferred to a scheme the ex-spouse/civil partner is already a member of, if the rules of the receiving scheme allow.

  2. Is it possible to take tax free cash from a pension credit?
    If the pension credit originated from crystallised benefits such as an annuity, a DB pension in payment or funds in drawdown, it is not possible for the ex-spouse/civil partner to take any tax free cash.  This is called a disqualifying pension credit.

  3. Is it possible to apply a pension sharing order when you are not married or in a civil partnership?
    No.  Pension sharing is only an option on divorce.  It is not an option for unmarried couples or couples not in a civil partnership.

  4. When giving advice on a pension credit coming from a DB scheme where the only option is a transfer out, are the pension transfer permissions required?
    As the ex-spouse/civil partner is not giving up any benefits in the DB scheme, the pension transfer permissions are not required.

  5. Are there any pensions which can’t pay a pension credit to an ex-spouse/civil partner?
    Yes.  State pensions, pensions inherited on death including beneficiary drawdown or any pensions which already have an earmarking order as a result of a divorce.

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Last updated: 18 Jun 2018

This website is intended for financial advisers only and shouldn't be relied upon by any other person. If you are not an adviser please visit royallondon.com.

The Royal London Mutual Insurance Society Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. The firm is on the Financial Services Register, registration number 117672. It provides life assurance and pensions. Registered in England and Wales number 99064. Registered office: 55 Gracechurch Street, London, EC3V 0RL.