Guide to Inherited Wealth and Divorce

Inheritance that has been received or may be received in the future is not automatically included when splitting assets on divorce, but it can be taken into account depending on the circumstances.

Our team of expert divorce lawyers in Milton Keynes are here to provide detailed guidance and help tailored to your personal circumstances. In the meantime, this article provides an overview to whether you have to share your inheritance as part of the divorce settlement.

All assets on divorce are either matrimonial or non-matrimonial. Matrimonial assets include money or property that you or your ex have acquired during the marriage, although in most cases the family home will be treated as matrimonial no matter how it was acquired. Non matrimonial assets are money and property that have come from a source outside of the marriage.

Matrimonial assets are automatically included in the pot of assets to be divided between the parties. Non matrimonial assets, such as inheritance, are not automatically included in the pot. It may be possible to completely ringfence or exclude the inheritance from the financial arrangement. However, if the matrimonial assets are not sufficient to meet the needs of both parties, then the court are likely to take the non-matrimonial assets into account.

Upon divorce, the extent of a party’s needs can vary hugely, and will depend on many factors including the length of marriage, standard of living enjoyed in the marriage and most importantly, the arrangements which have been made concerning the parties’ children. Furthermore, a court can be persuaded to award more matrimonial assets to one party on the basis that the other party has access to inheritance as an alternative resource to meet their needs.

If inherited wealth is mingled with matrimonial assets, such as monies held in a joint account that the whole family benefited from, the court may decide it should be included in the marital pot and subject to sharing.

Future inheritance that has not yet been received, for example that which might be anticipated from wealthy parents, is not usually taken into account. This is because normally it cannot be said for sure when it might be paid, how much it will be or that a Will providing for it will not be changed.

While not a guaranteed way to protect your inheritance, you can help secure it with a properly drafted pre-nuptial or post-nuptial agreement. It is also a good idea to ensure that you keep the inheritance separate throughout the marriage and do not let it become mingled with other matrimonial assets.

Upon divorce, a financial settlement, which is drawn up into a properly drafted  consent order that is approved by the court, should protect you from any future claims your ex-spouse may make if you inherit property or assets at a later date.

If you or your spouse have recently inherited or due to inherit and you are considering a separation, taking advice on your legal options is essential.

Ready to take the next step? As leading divorce solicitors in Milton Keynes, our team of family law specialists can advise you about your divorce settlement. As well as our head office in Milton Keynes, we also have offices in Bicester, Watford, and London where we can arrange appointments to see you in person. Talk to us in confidence and find out where you stand. Get in touch – we’re here to help.

This article is intended for the use of our clients and other interested parties. The information contained in it reflects the author’s view and is believed to be correct at the date of publication. However, it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional legal advice.