In England and Wales, on divorce, the court will differentiate between how matrimonial and non-matrimonial assets are viewed.
Matrimonial assets are built up during the course of the marriage. A family home is usually viewed as being matrimonial, whatever the source of funds to acquire it were.
Non-matrimonial assets are assets that were acquired by prior to marriage. Any inheritance or gift received by one spouse during the marriage is considered non-matrimonial.
As a first step lawyers will usually look at the effect of dividing matrimonial assets equally between spouses. If this produces an outcome that meets both party’s reasonable needs that may well be an appropriate settlement and it is unlikely non-matrimonial assets will need to be considered. However, if the division of matrimonial assets does not meet the needs of both parties, non-matrimonial assets may need to be brought into the equation.
Distinguishing between matrimonial and non-matrimonial assets can be complex, particularly after long marriages. Non-matrimonial property often becomes matrimonial when it is mingled with matrimonial property, or when it is used to purchase an asset for the benefit of the family, such as a holiday home.
It is possible to protect non-matrimonial assets through a pre-nuptial or post-nuptial agreement. If you are about to marry and would like to protect your pre-marital assets, plus any future gift or inheritance, you should enter into a pre-nuptial agreement. If you are already married, you can still protect these assets by entering into a post-nuptial agreement. Post-nuptial agreements are common where parents want to make a substantial gift to a married child as part of their inheritance tax planning and want to make sure the gift is protected in the event of divorce.
If you don’t enter into a pre/post nuptial agreement, steps should be taken to avoid anything that might make your non-matrimonial assets matrimonial in nature. In practice, this can be very difficult to achieve and equally as difficult to demonstrate in the courts. Often this can only be done by keeping savings and investments entirely separate.
The distinction between non-matrimonial and matrimonial assets can be complicated, and will ultimately be decided on a case-by-case basis. That means legal advice is essential.
Contact our Family Team
The Family team at Bishop & Sewell have a wealth of experience in dealing with family law, finances on divorce, and pre and post-nuptial agreements. Please email family@bishopandsewell.co.uk or contact 020 7631 4141 and ask to speak to our Family Law team.
The above is accurate as at 3rd December 2024. The information above may be subject to change.
The content of this note should not be considered legal advice. Each matter should be considered on a case-by-case basis.
