Matrimonial Assets: What You Need to Know

Division of assets can be a contentious issue during divorce proceedings. There is a common misconception that financial negotiations operate on a “what’s mine is yours, and what is yours is mine” basis where everything is on the table; however, this is not always the case.

What assets are divided on divorce?

In England and Wales, the law recognises two types of assets: matrimonial and non-matrimonial. The category an asset falls into is significant in determining whether it should be subject to division upon divorce.

Matrimonial assets are those that have been acquired, built up, or treated as joint by you and your spouse during the marriage. Some examples include the family home (even if it’s just you or your spouse on the title), savings and any pensions accumulated.

Matrimonial assets are subject to division upon divorce, and the starting point is 50/50 unless the court feels that it is necessary to alter this to achieve a fair outcome. Typically, when the percentage is adjusted, it is in the favour of the financially weaker party.

The courts are less likely to depart from 50/50 when the capital and income resources available to each spouse are similar, if the marriage is short and if there are no children.

What kind of assets are excluded from division on divorce?

Non-matrimonial assets are those that you or your spouse have acquired before or after the marriage. Examples include lottery wins, inheritance, or shares in a family business.

Non-matrimonial assets can be ringfenced and kept separate from the pot of assets being divided up, provided that the needs of both parties can be met without a share of the non-matrimonial assets.

The best way to protect your non-matrimonial assets is to have a pre-nuptial agreement drawn up before marriage. A pre-nuptial agreement demonstrates how you and your partner intend to divide any assets in the event of a divorce, decreasing the chance of a dispute arising. If the marriage has already occurred, it’s not too late; a post-nuptial agreement will have the same effect.