Revolution in family law finally removes the need for blame as a basis for divorce
No one enters into marriage expecting it to end in divorce. However, for many couples, divorce is the sad reality. If you are facing divorce, it is important to know that you are not alone. Each year, thousands of people go through the divorce process.
While divorce can be a difficult and emotionally charged time, there are things you can do to make the process go more smoothly when important decisions need to be made. Keeping a level head to negotiate a fair financial settlement is vital.
No-fault
divorce
removing
the
need
for
blame
From
6 April
2022
no-fault
divorce
came
into
effect
in
England
and
Wales.
This is
a
long-awaited
revolution
to
family
law,
finally
removing
the need
for
blame as
a basis
for
divorce.
Now the
only
ground
for
divorce
is that
the
marriage
has
‘irretrievably
broken
down’.
This means the law no longer requires blame to be apportioned, neither is there any requirement to fit your particular circumstances into one of the five facts that you previously had to prove, i.e. there is no need to cite behaviour or adultery nor wait for the minimum two-year separation period.
More
amicable
resolutions
for
parties
In
addition,
further
crucial
changes
are that
the
respondent
to the
divorce
is now
unable
to
contest
the
divorce
(the
limited
grounds
to
challenge
a
divorce
relate
to
jurisdictional
grounds
or
validity
of
marriage).
If you and the other party both agree the marriage has broken down irretrievably, then a joint application for divorce can now be made.
If you find yourself in this situation, here are 5 points to consider
1.
Seek
professional
advice
immediately
Seek
legal
and
separate
financial
advice
immediately.
Your
professional
financial
adviser
can help
you draw
up a
list of
joint
and
personal
assets
and
valuations,
so any
legal
advice
you seek
is based
on
accurate
information.
This can
make an
appointment
with
your
solicitor
more
time and
cost
effective.
You’ll need to draw up a list of assets e.g. first or second homes, pension pots, investments, value of any businesses etc., checking when they were purchased and finding out if they should fall into the category of marital assets, In addition, list all your outgoings both joint and individual.
2.
Cancel
all
shared
finances
Cancel
any
financial
commitments
that
might be
in a
joint
name
immediately.
The more
unscrupulous
partner
could
take
advantage
otherwise
and
saddle
you with
debt you
are
liable
for. So
cancel
credit
cards,
joint
accounts,
personal
loans
and even
overdrafts
if
possible
and set
up
afresh
in your
own
name.
3.
Timing
is
everything
Although
it may
be the
last
thing on
your
mind,
choosing
the
right
time of
year to
divorce
could
significantly
impact
on the
financial
outcome
for each
individual.
When a
marriage
or
registered
civil
partnership
breaks
down, it
is
likely
that tax
will not
be at
the top
of the
agenda.
Your
tax
position
refers
to the
amount
of
Income
Tax and
Capital
Gains
Tax
you’ll
need to
pay.
During
the
divorce
process,
there is
a window
of time
where a
spousal
exemption
applies
and then
drops
off.
4.
Splitting
pensions
When
it comes
to
pensions,
finding
a way to
achieve
a clean
break so
you are
not
tethered
to your
partner
forever
is key.
What can
be
divided
depends
on where
in the
UK you
are
divorcing.
In
England,
Wales
and
Northern
Ireland
the
total
value of
the
pensions
you have
each
built up
is taken
into
account,
excluding
the
basic
State
Pension.
In Scotland, only the value of the pensions you have both built up during your marriage or registered civil partnership is considered. Normally, anything built up before you married or after your ‘date of separation’ does not count.
There are two main ways of dealing with pensions at divorce that apply across the UK.
1. Pension sharing is often the favoured way of dividing a retirement fund because it achieves a ‘clean break’. This involves couples splitting one or more pensions. The aim is to ensure that the future incomes of both spouses are equalised. Your professional financial adviser will be able to help you implement any pension sharing order after the splitting process is complete.
2. The second option, pension offsetting, sees pension rights balanced against other assets, such as the home. Typically, if one spouse has a pension fund worth £500,000 and the couple jointly own a property worth £500,000, one may keep the property and the other keep the pension – though things are rarely that simple, so professional advice is key.
5.
Budget
for
your
future
Whatever
happens,
your
life is
going to
be very
different
once the
divorce
is
complete
so it’s
important
to
budget
for the
future
life you
want to
live.
Obtaining
a copy
of your
credit
report
is a
good
start,
so you
know
what
your
standing
is,
especially
as many
people
will
need to
think
about a
new
mortgage
after
divorce.
A credit
report
will
also
highlight
any
joint
lending
you
might be
liable
for.
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