Divorce is a time of change for all parties involved. However, when it comes to financial provision on divorce, the law aims to divide the matrimonial property fairly, to provide parties with a degree of certainty and to facilitate a 'clean break'. The starting point is an equal division of the assets built up during the course of the marriage. There can be deviations from this starting point which are referred to below.
How assets are divided on divorce
As part of the divorce process, the assets accumulated during the marriage will be assessed and valuations obtained. This will include the parties' interests in any companies and pensions. In determining how the assets are to be divided, the law can consider a number of factors, such as any economic advantage enjoyed by one spouse during the marriage derived by the financial contributions of the other, any economic burden of caring for children under the age of 16 after divorce and the needs of the financially dependent spouse to adjust to their new standard of living post-divorce. The source of funding of any assets can also be considered. For instance, account can be taken of the fact that an asset derived from inheritance or a gift from a third party.
Maintenance until divorce
Spouses have a duty to maintain each other, both before and after separation. This obligation lasts until the point of divorce and is referred to as 'aliment'. The obligation is to provide such support as is reasonable in the circumstances, having regard to the parties' respective needs and resources, their earning capacities and general circumstances of the case.
In assessing whether aliment should be payable by one spouse to the other, a court will assess whether the "paying" party is financially capable of making payment. In that scenario, both parties will put forth evidence to clarify their respective financial positions.
Maintenance after divorce
Maintenance after divorce is known as 'periodical allowance'. It is generally awarded for no more than three years post-divorce, but may be for a greater or lesser period, or not at all. The law provides that payments of this nature can be awarded when the capital received by the spouse is insufficient to allow them to adjust to being without the support of the other.
The right financial settlement on divorce
Clean breaks can, however, be achieved via the payment of a lump sum, commonly known as a capital sum, from one spouse to the other as part of the overall financial settlement. Depending on the level of capital available, payment of a lump sum may go some way to allowing both parties to maintain their respective lifestyles after divorce. It may be prudent for parties to engage with financial advisors who can assist them in managing any sums they receive as part of a divorce settlement.
Whether you are looking to protect your assets or ensure that you can maintain your current standard of living post-divorce, it is essential to have the best legal team by your side. For that, we're here to help.
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