Assets and inheritance acquired after your separation but before your divorce is finalised, such as property, purchases and inheritances, may become part of your divorce settlement, depending on the needs of you and your ex-partner. As such, any assets purchased or gained up until the point that your case goes to court and an agreement is reached may be taken into account when making a decision on your divorce financial settlement.
Buying a house after separation but before divorce in the UK
You can buy a house after separation but before your divorce is finalised. However, doing so may make your divorce more complicated when you move to the financial settlement stage.
Assets acquired after separation but before the divorce is finalised (i.e. when the Final Order is granted), such as property, may be considered non-marital assets and may be ringfenced by the court to be kept by the acquiring party. On the other hand, if the marital assets are not enough to cover the needs of both parties and their children and to allow them to maintain the same lifestyle, those assets may be divided between both parties as part of the divorce financial settlement. In addition, purchasing a house for you and your children may also change the court’s view of your needs and could reduce your share of the financial settlement.
Before making a decision to purchase a property before your divorce is finalised, it is essential to discuss your case with a family lawyer who can explain how to protect your interests and ensure you receive the best possible divorce financial settlement. Making the right decisions now will save you from financial problems in the future.
Inheritance after separation but before divorce
Any inheritance that you or your ex-partner receive after separation but before your divorce is finalised will not automatically form part of your divorce financial settlement and, therefore, be viewed as a non-marital asset. However, it is important to remember, that if your matrimonial assets are not sufficient to meet the needs of you and your ex-partner, the court may take into consideration non-matrimonial assets such as inheritance and reduce the amount an individual receives from the matrimonial pot.
For example, take the following scenario:
- A divorcing couple have little in the way of marital assets apart from the family home, which is worth £400,000.
- The court assesses that both parties need £400,000 each to set up a new home. The proceeds of selling the family home would, therefore, not be sufficient.
- However, one party receives a large inheritance of £400,000 after the separation but before a settlement is reached.
In this case, the court may award the party who did not receive the inheritance all of the equity in the family home.
Future inheritance after divorce
Any future inheritance that you expect to receive after your divorce is finalised is typically not taken into account when reaching a divorce financial settlement due to the uncertainty of how much and when you will receive it. After all, the will may be changed, or the value of the inheritance will be reduced significantly by the time it is received.
With that said, if no Clean Break Order is put in place by the court, there will remain a possibility that your ex-spouse can make a claim on assets such as inheritance. For this reason, it is preferable to seek a clean financial break from your ex-partner to ensure this does not happen in the future.
Separated but not divorced, and spouse dies in the UK
Under the current law in England and Wales, if you or your ex-spouse die while you are separated but not fully divorced, there is a risk that the surviving spouse will be able to inherit the entire estate under the rules of intestacy (which apply if there is no Will in place). This is because until a divorce is finalised, you are both legally married, and under the rules of intestacy, if the deceased has no children, the surviving spouse inherits the whole estate automatically.
