Pension annuities cannot be transferred

When a married couple separates, one of the assets which are often central to the finances of the marriage is the pension. This is particularly so where a couple have had a long marriage and are close to retirement age.

Under the Matrimonial Causes Act 1973, the court has a range of powers when dealing with the finances of the marriage, these include making pension sharing orders (where one party’s pension is shared with the other party) and pension attachment orders (where the party without the  benefit attaches herself/himself to the same pension of the party with the provision).

A party may be able to buy an annuity when they draw down their retirement benefits to provide him or her with a guaranteed income either for the rest of their lives or for a fixed number of years. In the recent case of Goyal v Goyal [2016] it was decided by the Court of Appeal that there was no power for the court to order that the husband transfers his annuity to the wife.

In this case, it was found that the husband had dissipated the family finances following an addiction to gambling. The husband agreed to give one-half of his pension to his wife by way of a pension sharing order. When doing so, the husband did not declare that he had converted them to an Indian annuity. The initial judge did not think he was able to make a pension sharing order because the annuity was in India and therefore made a mandatory injunction requiring that the husband immediately transfers the annuity to the wife. The Court of Appeal concluded that the first judge had no jurisdiction to make an injunction under the 1973 Act and that the Indian scheme could be subjected to a sharing order, despite being overseas.

Pensions are extremely complex, particularly those with an overseas element. Our solicitors at Hunter & Uro have experience and expertise in all aspects of financial matters, including money-purchase, occupational, final salary, government and foreign pension schemes. If you are separating from your spouse, we can assist you with both divorce and financial matters. Serving Bedford, Northampton and Milton Keynes, our lawyers can help you with your family law and divorce matters.  Contact us on 01234 889777 for a free consultation.

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