What is a Pension Attachment Order?
Lauren Gaines
Table of Contents
Guide to Pension Attachment Orders
Pensions are quite often valuable assets in a marriage. In some cases, they can be worth more than the family home. When it comes to a divorce, they are considered just as much an asset available for sharing as cash in a bank or property.
The most common way that pensions are shared in a divorce is through a Pension Sharing Order. In this arrangement, a percentage of one person’s pension is transferred to the other, resulting in two separate and independent policies. Each person is then in full control of their own pension pot and can deal with it as they like.
Pension Attachment Orders are another method for dividing pensions during a divorce. While significantly less common than pension sharing, there are situations when a Pension Attachment Order may still be the preferred option.
What is a Pension Attachment Order?
A pension attachment order, also known as pensionearmarking, is a legal arrangement that allows one spouse to receive a percentage of any benefits paid out from the other spouse’s pension, whether that may be a lump sum payment or income.
This is unlike pension sharing, where an immediate transfer of pension rights occurs. An attachment order keeps the pension in the original owner’s name until they start withdrawing funds. At that point, part of the pension gets redirected to their former spouse. This is the part of the pension that has been ‘earmarked.’
How do Pension Attachment Orders work?
Pension Attachment Orders can only be made by the court, either with the consent of both parties or ordered by a Judge as part of a Financial Remedy Order after a contested hearing. The Order sets out the percentage of the pension benefits to be paid to the ex-spouse and if applicable, any conditions or restrictions on when the payments can start.
The Order can be structured so that the ex-spouse receives one or more of the following benefits:
- All or part of the pension holder’s tax-free cash sum
- All or part of the pension holder’s monthly pension income
- All or part of any lump sum paid when the pension holder dies.
What are the advantages of a Pension Attachment Order?
- Earmarked funds: It allows for a share of the pension benefits to be earmarked for the benefit of a spouse without having to transfer any assets or create separate policies.
- Growth potential: If the pension continues to receive contributions, the value of the earmarked portion may increase over time, providing more significant benefits at retirement.
- Transferability: If the pension holder transfers their pension to another provider, the Attachment Order will typically move with it, keeping the arrangement intact.
- Death benefits: Earmarked savings can include any death-in-service benefits, providing additional financial support to the recipient.
- Tax benefits: Earmarked pensions are generally considered taxable income to the pension holder, exempting the recipient from declaring their share for tax purposes.
What are the disadvantages of a Pension Attachment Order?
- No clean break: It does not provide a clean break between the parties as there is still a financial link between them.
- Dependence: The receiving spouse has limited control over the pension’s performance and is reliant on decisions made by their ex-spouse regarding contributions and withdrawal timings. If the pension holder decides to retire early, for example, this may significantly decrease the funds that their former spouse expected to receive.
- Capable of change: the order is capable of being varied in the future which makes the receipt of benefits expected far less certain than a pension sharing order.
- Death: the death of either party will terminate the order.
- Marital changes: The recipient spouse will not get any income-related pension benefit if they remarry or enter a new civil partnership.
What if the pension is overseas?
While a Pension Sharing Order is the most common way to split UK-based pensions, they may not be appropriate for pensions held overseas. That is because not all countries allow for pension sharing. Even when they do, the process of dividing a foreign pension can be costly and time-consuming.
Since Pension Attachment Orders involve the original pension scheme remaining as it is, with no change in ownership, a pension scheme manager may be more willing to comply with a Pension Attachment Order compared to a Pension Sharing Order.
Every jurisdiction and pension scheme has its own rules, however. The international divorce solicitors at Osbornes are experienced in international divorces and assets that are held overseas. We can carry out the necessary investigations and advise you on the best way to proceed.
Is a Pension Attachment Order right for me?
Given the extensive issues around Pension Attachment Orders, it’s no surprise that they are used less often than the more popular Pension Sharing Orders.
However, which type of pension order is best for you will depend on your individual circumstances and objectives. Some may prefer the simplicity of setting up a pension earmarking order and the fact they (or their ex) can continue to manage the growth of their own pension fund until retirement.
It is always best to talk through the pros and cons of Pension Attachment Orders with an experienced divorce lawyer.
Need advice on the treatment of pensions in a divorce? Speak to our experts.
If you’re considering Pension Attachment Orders or have questions about finances during your separation, it’s important to talk to a qualified divorce lawyer.
Our solicitors specialise in financial settlements, covering options for pensions when divorcing. We can give you clear, straightforward advice based on your situation and help you understand the different options available to you. To speak to us about pensions and divorce:
- Call 020 7485 8811. or
- Fill out the contact form below
Share this article
Contact
Contact us today
For a free initial conversation call 020 7485 8811
Email us Send us an email and we’ll get back to you
"Osbornes handle a significant amount of complex, high-value divorce work."
"Osbornes have talented fee earners at all levels."
"Osbornes is a top-end firm, a very well-established name. They have high-value matters, deal with complex matters and have a good team."
"Lisa Pepper is a standout mediator - smart, sensitive and able to narrow the issues with ease."
"Lisa is good at cutting to the chase and identifying issues. She gets people talking and brings people together."
"Lisa is excellent - she's efficient, has a very good rapport with her clients and has an enormously outgoing energy. She is very effective in managing clients' cases."
Osbornes is vastly experienced and able to think around the issues and consider them in a new and refreshing way
Osbornes is a really good team that gives a first-class service which is both sensible and insightful but also supportive of the client's needs.
Osbornes Law offers affluent clients representation in high-value, complex family matters.
"Osbornes Law have a very broad family practice which does all areas of family law at a high level. They have an excellent practice; they are top quality across the board."
Lisa Pepper is particularly recognised for her role as a mediator in complex cross-border disputes. Her practice also includes handling prenuptial agreements and issues arising from divorces. She is additionally skilled in Schedule 1 and other child arrangement matters.
Mark Freedman frequently takes on high-value financial and children proceedings that involve complex tax, trust and accounting issues.
"Andrew Watson is respected and tenacious in matrimonial finance. You would want him on your team."
"David Leadercrammer is such an experienced wonderful lawyer who you would want on the other side of your case. He’s sensible, pragmatic and hugely experienced in money and children cases."
Osbornes have been a sound firm forever. They have phenomenal work and an excellent skill set.
Osbornes have high-end partners doing high-end work. They are very impressive.
They have an excellent practice; they are top quality across the board.
Osbornes have a very broad family practice which does all areas of family law at a high level.
He is very hard-working, diligent and thoughtful in his approach. He is on top of the detail and makes strategic decisions.
He commits himself to getting the best results.
He’s a really tough litigator that you certainly want on your side. He will defend his clients to the hilt.
Mark is an immensely capable lawyer, with vast experience and a well-deserved reputation for getting the very best for his clients.
Lisa Pepper is extremely hard-working and adored by her clients. She is a very empathetic and approachable lawyer.
She’s an extremely supportive and kind lawyer and has an increasing mediation profile too
The Osbornes mediation team is excellent and has some good individuals.
"Continues to receive a growing number of instructions from high-net-worth individuals, frequently with cross-border components, and advises on a steady flow of complex cohabitation matters, often involving large property portfolios."
Andrew secured me the best financial settlement for my claim. He is a credit to Osbornes Solicitors.
"Lisa Pepper was recommended to me as non-nonsense and able to help me with a difficult and confrontational divorce. She more than lived up to that – she was practical, collected and always available with a clear opinion and suggestions of how to move forwards. She also was open and helpful about costs and how to mitigate them"
"It has a strong and experienced team of solicitors who don’t take bad points, work sensibly to get a settlement and who you can always pick up the phone and speak to. They are good lawyers and know the strengths and weaknesses of their clients’ cases. They don’t posture and always pursue their clients cases appropriately. "
"Mark Freedman is a very capable lawyer, renowned for not being a pushover and pushing his clients’ cases as much as he can, but will always talk sensibly about settlement. He is among the best – tenacious, good judgment and tactically aware."
"Mark Freedman is a dynamic and highly experienced family lawyer who fights extremely hard for his clients and is always in their corner, thus ensuring their loyalty and confidence. In a trial you would always want him on your side."
"Bridget Thompson combines her excellent legal knowledge with a clear, succinct and robust style of advice and advocacy. Her approach clearly inspires a high degree of client confidence in her"
"She has impressed me as someone who fights my corner but also understands the importance of resolving issues without unnecessary escalation. She is calm and reassuring."
"Her mediation practice is exceptional; she is also a great solicitor and has a breadth of skill which is really useful."
"He is really experienced and wise. He has a lovely manner about him and clients feel safe with him."
"Jo Wescott is top notch and widely recognised as a rising star throughout the profession. She brings a winning combination of great judgement, an immense work ethic, and a relaxed and charming way with opponents and clients alike. Someone you want on your side”
"Osbornes is pre-eminent for family law in North London. Mark Freedman is a real rainmaker. He is an excellent lawyer and has a top-notch practice"
Mark Freedman is intelligent and personable and has a good selection of high-net work cases.
"Exceptional value for money. Highly competent and reasonably priced. Mark Freedman: one of the best in the field."
"Client-focused. Ready to fight the clients’ corner, but also ready where possible to steer client from unnecessary dispute. Mark Freedman – very experienced, with good instinct for the eventual result. Clients love him and he thinks ahead and directs the client to the best result for the client."
Mark Freedman is a serious player. A fearless family law litigator, who protects his clients’ interests passionately.
Breadth of knowledge and willingness to go the extra mile is what makes it stand out. Mark Freedman – devoted to his clients
Mark Freedman frequently takes on high-value financial and children proceedings that involve complex tax, trust and accounting issues. Sources praise the "tenacity and common sense" he brings to challenging disputes.
"Mark is very experienced, competent, good with clients and takes a sensible approach to cases. He knows exactly what he's doing."
"An exceptional outfit. They take on difficult cases, fight hard and win."
"They are an outstanding firm to work with. They are consistently impressive in their work."
"The team frequently deals with cross-border estates for high–net-worth individuals."
"Mark Freedman is a real heavyweight litigator who has dealt with some very significant cases."
"Mark Freedman boxes clever, keeps his powder dry and when it comes to the end game he negotiates a really good deal."
"Mark Freedman has a specific focus on high-net-worth divorces and finance cases where there are overseas assets and trusts."
"Lisa Pepper somehow manages to get parties to settle on matters where there isn’t much hope to start out with."
"Well-regarded family practice assisting clients with substantial matrimonial disputes and sensitive children proceedings."
"Mark Freedman draws acclaim for his work in high net worth divorce cases, including those involving company structures, family trusts and overseas assets."
"He never gives up. He fights for you to the end and has boundless energy."
Bridget Thompson heads the family team, where client care is the top priority.
Mark Freedman advises high-net-worth clients and knows his stuff.
Highly regarded for his experience as a litigation and mediation expertise, Mark Freedman is tenacious and determined. Clients really feel that he is fighting their corner.
Andrew handled a very complex, 3 year legal battle for me, with a tremendous amount of patience and professionalism. He is very approachable, always kept me up to date, by phone and e-mail, and responded very quickly to my queries with excellent advice, sound strategic thinking and strong letters to put the other side under pressure. With top contacts for barristers, joint experts and mediation.
[The Family Law department] handles significant matrimonial finance cases and complex nuptial agreements. Respected for its expertise in cross-border children law matters.
They have a really good, strong team, with the junior elements punching well above their weight. It doesn't matter who you talk to; they are all switched on."
Mark Freedman represents high net worth clients in complex financial disputes. Sources say that "he's a determined negotiator who'll always do the very best for his clients.
Osbornes fields a sizeable team with many standout lawyers.
"Mark Freedman receives a lot of instructions from clients based abroad, often relating to complex divorce proceedings. Sources say: “His main strengths are his enthusiastic passion for the job in hand and his total dedication to his clients.”
This team is perhaps best known for its children work, often involving complex international dynamics.
Accreditations
Related InsightsVIEW ALL
1.10.2024Borrowing Money for Legal Fees in Divorce
What if I can’t afford a lawyer for my divorce? When navigating a divorce, it is widely understood that...
Read more- 27.9.2024
Navigating Divorce, Child Arrangements, and the Jewish Festivals:...
Going through a divorce is challenging enough, but when you’re a Jewish couple with differing levels of religious observance,...
Read more 
25.9.2024Who Pays the Debts After Divorce?
Am I liable for my husband’s debts if we are separated? Debt is a significant source of stress for...
Read more- 25.9.2024
What Happens to Savings & Investments in Divorce?
Is my spouse entitled to my savings and investments if we divorce? During the divorce process, both parties should exchange...
Read more - 23.9.2024
International footballer fails to comply with financial disclosure
UD v TQ: The importance of complying with financial disclosure Recent divorce case involving an unnamed international footballer is a...
Read more - 20.9.2024
Navigating Property Rights in Divorce: Yacht vs. House
A Yacht, A House, and Terminating Matrimonial Home Rights The family court has ruled in the latest instalment of a...
Read more - 11.9.2024
Financial relief after overseas divorce: a case study...
Can I claim financial relief after an overseas divorce? Obtaining a divorce in Algeria did not prevent a wife from...
Read more - 6.9.2024
Uncontested Divorce
What is an Uncontested Divorce? Since no-fault divorces were introduced on 6 April 2022, respondents in divorce proceedings no longer have the...
Read more - 5.9.2024
Legal Separation vs Divorce
Legal Separation Versus Divorce: What Are Your Options? Divorce is not the only option when a marriage breaks down. Some...
Read more - 27.8.2024
Pension Sharing Orders
Pension Sharing in Divorce With so many things to consider when dividing up your finances during a divorce or dissolution...
Read more - 20.8.2024
What is pension offsetting?
In this article, we will explore the concept of pension offsetting and how it can play a crucial role in...
Read more - 20.8.2024
Do You Have to Divorce in the Country...
How to divorce if you married abroad People choose to get married abroad for various reasons. Some couples want an...
Read more - 12.8.2024
NA v LA [2024] EWFC 113: Judge Orders Non-Court Dispute...
Financial Claims: Judges Can Order Parties To Attempt Non-Court Dispute Resolution As was expected, the court has been quick to...
Read more - 8.8.2024
Wife’s Award Increased Due to Failure To...
Understanding the Impact of Changed Circumstances on Prenuptial Agreements Prenuptial agreements have become the norm where a husband or wife...
Read more - 5.8.2024
Why Did Lauryn Goodman Take Kyle Walker to...
Introduction to the case After a judge took the unusual step of making his judgement public, we’re starting to...
Read more - 1.8.2024
Standish v Standish: Court of Appeal Decision on...
Court of Appeal reduces wife’s divorce award by £20million Dealing with financial matters on divorce can be complex. And...
Read more 
1.8.2024Matrimonial vs Non-Matrimonial Assets
Matrimonial vs Non-Matrimonial Assets in Divorce During a divorce, people often make the mistake of assuming that everything they own...
Read more- 1.8.2024
What is a Periodical Payments Order?
Periodical Payments Orders in Divorce Throughout the process of a divorce or when unmarried couples with children split up, there...
Read more - 1.8.2024
What is a Lump Sum Order?
Lump Sum Orders in Divorce When a relationship breaks down, as well as legally ending the marriage through a no-fault...
Read more - 25.7.2024
What is a Property Adjustment Order?
Property Adjustment Orders in Divorce As part of the divorce process, separated couples must decide how they are going to...
Read more 
11.7.2024Unmarried With Children and Splitting Up
Unmarried with Children? What are your Financial Rights? Know Your Financial Rights Under Schedule One Children Act 1989 A claim under...
Read more- 17.6.2024
What is Early Neutral Evaluation?
Early Neutral Evaluation (ENE) is a form of Non-Court Dispute Resolution where the separated couple invites a neutral third party...
Read more - 14.6.2024
What Happens If You Have a Joint Mortgage...
Understanding whether you can keep a joint mortgage after divorce is crucial, especially if both parties are still liable for...
Read more - 10.6.2024
What is Financial Disclosure in Divorce?
Introduction to divorce financial disclosure A divorce ends your marriage but it doesn’t end your financial ties to your...
Read more
