Pensioner - Need to know

Pensions and divorce/dissolution of a civil partnership

 

Under the Welfare Reform and Pensions Act 1999, your pension rights in the Local Government Pension Scheme (LGPS) may be shared as part of a divorce settlement made in the courts of England and Wales. Divorces in Scotland are also affected, but slightly different rules apply.

Pension sharing in the LGPS applies to you if you are

  • an active member
  • a deferred members, or
  • a pensioner member.

But it doesn’t apply to you if you’re getting

  • a husband’s, wife’s or civil partner’s pension
  • a dependant’s pension, or
  • an injury pension.

Courts need to know what your pension benefits are worth before they decide how to take their value into account when you get divorced or dissolve a civil partnership.

CETV

You usually have to request a value (called a CETV) from us in writing yourself. Or in special circumstances the court can request the value, or you can give your solicitor, your partner or their solicitor written permission to request it on this form.(available soon)

We don’t charge you for this information.

What might the court do about your pension?

Once the court knows the value of your pension benefits, it will look at the pension options, which are described below.

  • Offsetting – the value of your pension benefits is ‘offset’ against your other assets. For example, you could keep your pension and your ex-spouse could get a larger share of the value of your house.
  • Earmarking – a specified amount of your pension and/or lump sum is paid to your ex-spouse at the same time you start getting your pension.
  • Pension Sharing – this is available if your court proceedings began on or after 1 December 2000. Pension sharing means your pension benefits are split at the time of divorce by a value (percentage) agreed by the court.

The court will send us a pension sharing order so we can apply the split they decide on.

Charges

We make a charge for applying a pension sharing order. Click here for details of when and what we charge. (PDF 72KB)

Pension debit

We reassess the value of your pension benefits at the transfer date. This is either 28 days from the date of the pension sharing order or the date of your decree absolute. We then split your pension benefits in line with the pension sharing order. So if the order requires a 50/50 split and your pension is £10,000, we will reduce your pension by 50%, or £5,000. This is called a pension debit.

Your pension debit (both pension and lump sum if appropriate) will go up in line with the rise in the cost of living between the date we first calculated it and the date you get your pension benefits. When you get your pension benefits, we will deduct the revalued amount of the pension debit from them.

If you re-marry, any partner’s pension payable under the rules of the pension scheme will also be reduced because of the pension sharing order.

Children’s pensions are unaffected by a pension sharing order

Pension credit

As a result of a pension sharing order your ex-spouse will be awarded a pension in their own right. This is called a pension credit. Click here to find out more about this.

Increasing your benefits

If you have your pension benefits reduced because of a pension sharing order you may want to think about topping them up in some way. Click here to find out how you could do this.

Transferring your benefits

You can still transfer your remaining benefits to another pension arrangement if you leave the pension scheme. Click here for more about this. If you transfer within the LGPS, your new fund will reduce your benefits by the pension debit when you retire.

Divorce guide

Get more information about pensions and divorce or dissolution of a civil partnership in our divorce guide. (PDF 72KB)