Divorce and financial arrangements

One of the most complicated practical implications of divorce or separation from a long term partner is having to sort out your financial affairs. Identifying your shared assets, disentangling your finances and deciding who keeps what can be very challenging. In addition, former husbands and wives may be obliged to pay maintenance towards their former spouse, particularly if there are any children involved.

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Voluntary Arrangements

Most divorcing couples come to their own arrangements (known as voluntary agreements or family-based arrangements) regarding the distribution of money, property and other assets. The government's Money and Advice Service has a divorce and separation calculator which can help with identifying assets and considering how to split them. You can also find useful information in a 'survival guide to sorting out your finances when you get divorced' produced by charity Law for Life.

Mediation can often be helpful when discussions are tricky - and divorcing couples must generally at least consider mediation (ie. by attending a Mediation Information Assessment Meeting) before taking a dispute to court.

You can obtain a 'separation agreement' which sets out the provisional and temporary financial arrangements in advance of the divorce going through.

Consent and Clean Break Orders

If you manage to agree on the financial arrangements following a divorce, you can draft a 'consent order'. This will generally include details on how you are going to divide up your assets such as money, property, savings and investments - and it can also include arrangements for spousal and/or child maintenance payments.

Normally a family lawyer will help you draft a consent order, which must be signed by both former partners. You also both need to fill out a 'notice of an application for a financial order' and a 'statement of information form' which, together with the draft consent order, are sent to a court. A family judge will then decide whether to make this order legally binding.

Where there is no ongoing spousal maintenance, a 'clean break' clause may be inserted into a consent order. Sometimes simply known as a 'clean break order', this clause essentially severs all financial ties between former husband and wife. So, for example, if either person later comes into a fortune (eg. as a result of inheritance etc.) the other person cannot claim any of this new money.

Financial Order

If you cannot come to an agreement together (eg. if there have been issues of domestic violence), you can apply to the court to decide on the post-divorce financial arrangements, in the form of legally binding 'financial order'. This may include things such as a lump sum payment, ongoing maintenance payments and ownership of property. You will need to fill in a financial order application form and send two copies of the form to the court dealing with your case. The process can take 6 - 12 months and will involve going to court.

Maintenance payments

Depending on the individual circumstances, a court can also make 'maintenance order' which usually requires the person with the highest income to provide regular financial assistance (eg. monthly payments) to their former partner. Although child maintenance can also be decided on by the court, it's usually dealt with by the Child Maintenance Service.

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Divorce from £99+VAT

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