Asset Division During Divorce Skip to main content
winston-solicitors-asset-division-on-divorce
Advice

Asset Division During Divorce – Avoiding Costly Mistakes

Harriet Reid Harriet Reid
4 min read

Asset Division and Divorce

Asset division is a tricky business during divorce. Especially if you’re doing your best to keep things amicable. Going through a divorce is never easy. Beyond the emotional strain, there’s the challenge of untangling finances and ensuring both parties can move forward with financial stability. From pensions to property, careful planning can make all the difference in securing your future. Here’s what you need to know about dividing assets fairly and protecting your financial wellbeing.

To discuss asset division call us on 0113 320 5000

Asset Division Affects National Insurance Contributions 

Did you realise that asset division includes your pensions? One often-overlooked aspect of divorce is how it can affect your state pension. If you’ve taken time away from work for childcare or helped in a family business without a formal salary, you may have gaps in your National Insurance (NI) record. These gaps can reduce the amount of state pension you receive in retirement.

The good news? You may be able to fill in those gaps. The deadline to make voluntary contributions for missing years between 2006 and 2016 is April 2025. Checking your NI record on the HMRC website now could help you boost your pension entitlement before it’s too late.

This is particularly important for farming families or couples where one spouse has contributed to a business without receiving an official salary. Ensuring both parties get their full pension entitlement during asset division is a crucial step toward long-term financial security.

winston-solicitors-asset-division-on-divorce-separation-pensions

Child Benefit and NI Credits - Are You Missing Out?

If you’re separating and weren’t previously claiming Child Benefit due to income limits, now might be the time to start. The income threshold for the high-income child benefit charge increased in April 2024, meaning that families earning under £60,000 may now qualify.

Claiming Child Benefit doesn’t just provide financial support - it also gives NI credits, which count towards your state pension. If one parent has taken time off work to raise children, ensuring that they receive these credits can make a big difference in retirement. If your family was already claiming, consider switching the claim to the lower-earning spouse to help secure their future pension entitlement.

Asset Division and Pensions - Don’t Overlook Your Future

When it comes to financial settlements, people often focus on property and savings, but pensions can be just as valuable. The most common ways for sharing pensions are:

  • Pension sharing order – A legal agreement that gives one spouse a percentage of the other’s pension pot.
  • Pension offsetting – One spouse keeps the pension while the other receives assets of equivalent value, such as property or cash.

Both options have their pros and cons, and comparing assets like property versus pensions isn’t always straightforward. Seeking professional financial and legal advice before making any decisions in asset division is key.

Tax Considerations - Minimising Unnecessary Costs

Asset division in a divorce isn’t just about fairness - it’s also about tax efficiency. While recent changes to Capital Gains Tax (CGT) rules have eased some of the tax burden when transferring assets between spouses, CGT may still apply if assets need to be sold.

Careful planning can help to minimise tax liabilities. For example, structuring lump-sum settlements or selling assets in a tax-efficient way can reduce tax exposure. Working with financial planners and tax specialists can help ensure both parties keep as much of their wealth as possible.

winston-solicitors-asset-division-during-divorce

What If You Can’t Agree? 

If divorcing couples can’t reach a fair financial settlement, the courts may have to step in. Judges will consider factors such as income, financial needs, and each spouse’s contributions during the marriage. This relates to financial and non-financial contributions.

For those who own businesses, land, or farming assets, a court-imposed asset division may not always be the best solution. A more tailored approach, such as restructuring business assets or creating tax-efficient settlements, can lead to better outcomes.  

We work closely with accountants, financial planners, and land agents to ensure financial settlements protect long-term wealth.

Secure Your Financial Future with the Right Advice

Asset division in divorce isn’t just about what’s fair today - it’s about securing your financial future. From ensuring full pension entitlement to structuring settlements in the most tax-efficient way, the right legal and financial advice can make all the difference.

If you’re going through a divorce and need expert guidance, Winston Solicitors can help. Our experienced Family Law team is here to support you through every step of the process, ensuring you achieve fair and financially secure asset division. 

To discuss asset division contact us on 0113 320 5000

Client feedback

Exceptional Service - Highly Recommended I recently engaged the services of Winston Solicitors and was thoroughly impressed by the professionalism, expertise, and dedication demonstrated by the Winston team: Harriet Reid and Emily Bell. From the outset, they provided clear guidance, timely communication, and a level of care that made a challenging process much more manageable. Their attention to detail, responsiveness, and commitment to achieving the best possible outcome were evident throughout. I felt fully supported and confident in their hands. I highly recommend Winston Solicitors to anyone seeking high-quality legal services. Thank you for your outstanding work!
Emmanuel
In my divorce I dealt with Teresa Davidson and Emily Bell. I found them both at all times to be professional, responsive and compassionate. Based on my experience I would not hesitate to recommend them for any divorce or family law related matter.
Mark
I have received nothing but a fantastic service from Emily Bell and Harriet Reid during a challenging time. They have always been responsive and to the point with their communication. I am grateful for all the help I have received.
Bill
This be my 2nd time I've used Winston Solicitors & both times they have been Extremely Professional both Teresa & Judith fully understood my frustration on what was going on at that time but with Time & again Professional attitude i was Very Happy with there hard work i seriously recommend Winston Solicitors as they turn over every stone what needs to be done thank you Regards Ryan Doyle
Ryan
After having a very bad start to my court case with another solicitor- I was recommended Wendy and she was brilliant. I had great support from the start got the results I asked for. Highly recommend
Martina
Wendy at Winston solicitors was outstanding in supporting me through the complications of my divorce. She was compassionate, understanding and most importantly efficient throughout a difficult time and after having had a negative experience at a different solictors. I will be eternally grateful for everything Wendy has done - thank you.
John
Harriet at Winston Solicitors provided exceptional service while handling a matter for my mother during a particularly stressful time. She was incredibly thoughtful and reassuring throughout the process, always taking the time to ensure my mother felt comfortable and well-informed. Harriet’s approach felt very personal, and it was clear she genuinely cared about delivering the best possible outcome. I highly recommend Harriet for her professionalism, empathy, and dedication to her clients.
Amrit
Very happy with Winston's solicitors, I was able to be seen at very short notice which helped me out a lot, felt reassured with the short time i spent there, Hannah was very helpful and listened thoroughly to gain an understanding of what I was dealing with, I wouldn't hesitate to use again in the future if necessary
Richard