Kevin O'Higgins Solicitors

Splitting assets: Issue of pensions after separation

Tuesday, 15 March, 2016
Independent.ie

If you are retired or near retirement but are also in the process of a separation or divorce, the issue of what to do about pensions is hugely important. 

This is especially true in cases where a partner who was the homemaker had little or no opportunity to build up their own pension arrangements, while the other spouse had built up a significant fund.

Family legislation enacted in 1995 and 1996 provides for pensions to be taken into account when splitting family assets, and which was also extended to civil partners under the 2010 Civil Partners Act.

A family law court has the power to order that a pension be divided in whatever way it thinks is appropriate. This order is known as a pension adjustment order.

So, in a situation where one spouse has a substantial pension and the other has none, an order can be made so that part of the pension can be paid to the other spouse.

However, it is not always necessary to make an order, particularly if there are other financial assets in play. The court could also rule that a spouse be given a greater share of the family home, for instance.

If a pension is to be split up, a pension adjustment order is necessary as pension trustees are not allowed to alter the terms of a pension at the request of the pension holder. A separation agreement can't force trustees to split a pension either - it must be a court order.

Irish Independent