Financial Settlement & Asset Division Solicitors London

What is a Financial Settlement upon Divorce?

A financial settlement on divorce is the legal process by which the parties divide their assets, property, pensions and liabilities following the breakdown of a marriage or civil partnership. In England and Wales, the court has a wide discretion under the framework of the Matrimonial Causes Act 1973 to make financial orders including property adjustment orders, pension sharing orders, lump sum orders, and periodical payments orders. The starting point on division of matrimonial assets is equality, though the court will depart from equality where the circumstances require – for example, to meet the needs of one party or the children, or to reflect the non-matrimonial character of particular assets. A financial settlement is not automatic – it requires either an agreed order (a consent order) approved by the court, or a final order made by the court following proceedings.

How are Assets Divided in a Divorce?

The court considers all of the circumstances of the case under section 25 of the Matrimonial Causes Act 1973, giving first consideration to the welfare of any children of the family. The factors include the financial resources and needs of each party, the standard of living enjoyed during the marriage, the ages of the parties and duration of the marriage, contributions made by each party, and any conduct that it would be inequitable to disregard.

In practice, the court’s approach typically involves: identifying a schedule of all assets and which are matrimonial in nature; computing the value to be attributed to each asset; ; considering whether a clean break is achievable; and arriving at a division that meets the needs of both parties and, where assets permit, gives each party an equal or fair share of the matrimonial wealth. Following Standish v Standish [2025] UKSC 26, the Supreme Court confirmed that the sharing principle applies only to matrimonial assets – non-matrimonial property, such as inherited wealth or pre-marital assets, will generally be excluded from the sharing exercise save to the extent required to meet needs.

Business Interests and Shareholdings

Privately held businesses and shareholdings can be amongst the most significant and complex assets in a high net worth divorce. The court must determine the value of the business or businesses, whether it is a matrimonial asset (in full or in part), and how it should be divided without adversely affecting the enterprise. We regularly act in cases involving minority stakes, family companies, and businesses held through complex corporate structures. We instruct leading business valuation experts and have extensive experience in challenging valuations that we consider understate or overstate the true value of an asset.

Trusts and Offshore Structures

Offshore trusts and foundations present particular complexity in financial remedy proceedings. Courts take a pragmatic approach, looking beyond legal formality to assess whether a party has genuine access to or control over trust assets, whether they receive distributions, and whether trust structures are genuine or designed to frustrate a spouse’s financial claims. Our family team works closely with PHB’s specialist trusts and private client team to provide coordinated advice on trust-related issues in divorce – an integrated capability that many specialist family law firms cannot offer.

Pensions and Retirement Provision

Pension arrangements in high-net-worth cases frequently span multiple schemes, including defined benefit pensions, self-invested personal pensions (SIPPs), and overseas pension arrangements (which often will not implement overseas orders). The court has the power to make pension sharing orders, pension attachment orders, or to offset pension value against other assets. We work with specialist pension actuaries to ensure that pension assets are properly valued and that the settlement structure achieves a fair outcome, taking into account the different characteristics of each pension type.

Pre-Acquired and Inherited Wealth

Non-matrimonial assets – those owned before marriage or received as gifts or inheritance –  may be excluded from the sharing exercise. The Supreme Court in Standish v Standish [2025] UKSC 26 confirmed that the sharing principle applies only to matrimonial property and not to non-matrimonial property. Non-matrimonial property may be invaded to meet needs and may become matrimonialised depending on how the parties treated the assets during the marriage. This is a complex area of law in which we have particular depth of experience, and careful analysis of the history and treatment of each asset is essential.

Financial Disclosure

The first step in financial remedies negotiations or proceedings is for each party to provide the other with full and frank disclosure of all assets, liabilities, pensions and income. This is a critical first step to understand the financial landscape against which negotiations can take place. In high-net-worth cases, the disclosure exercise may require detailed analysis of corporate accounts, trust documentation, international property valuations, and complex remuneration structures. Where one party is not forthcoming, we can make applications to the court for specific disclosure orders.

Is there a Time Limit for a Financial Settlement After Divorce?

There is no absolute time limit for bringing a financial claim following a divorce in England and Wales, but delay can weaken your position.  Divorce proceedings must be commenced prior to an application for financial remedies being made and the Court is unable to make financial orders until a Conditional Order of divorce has been made.  The process is not automatic and a separate application must be made to ask the court to look at the financial provision to be made for the parties which can be made at any time after the divorce process has started,  However, the longer you wait, the more difficult it can become to establish the matrimonial character of assets that have grown or changed since the marriage ended  –  and the more likely it is that circumstances will have changed in a way that affects the outcome.

It is important that there is an order dealing with the finances, otherwise the claims remain open.  This can be achieved either by the court imposing an order at the end of contested proceedings, or, where the parties reach an agreement, by submitting a Consent Order to the Court and inviting a judge to approve it.  t. Without a formal court order, financial claims remain open indefinitely. We h2ly advise clients to formalise any agreed financial settlement by way of a consent order at the earliest opportunity.

Non-Court Dispute Resolution

Wherever possible we seek to resolve matters by way of non-court dispute resolution. We are experienced in private arbitration, private Financial Dispute Resolution appointments (engaging a senior barrister or retired High Court Judge as a private tribunal), mediation, and inter-solicitor negotiation. Many high-net-worth cases are capable of resolution without recourse to the courts, and the privacy advantages of non-court resolution are particularly important for clients with a public profile or commercially sensitive financial arrangements.