Inheritance and Divorce Settlements in the UK | Can My Ex Claim It?

If you are currently going through the process of divorce in the UK, you may be worried about whether your inheritance (e.g. received from a family member) will be included in your divorce settlement. Many people assume that inherited wealth automatically stays outside of divorce proceedings; however, this is not always the case. In reality, the courts of England and Wales have wide discretion in such cases, and inheritance can sometimes form part of the financial settlement depending on the resources and needs of the parties involved. In this article, we will look at how inheritance is dealt with in divorce, including whether your spouse can claim your inherited assets in divorce.

Can my ex-spouse claim part of my inheritance? 

Yes, in some cases, the family courts may include assets from an inheritance within a divorce financial settlement. It should not be automatically assumed that pre-marital assets, inheritances, assets in trust, or assets included in a prenup/postnup cannot be included in a divorce financial settlement. This is not the case. Judges in such cases consider a range of factors when determining how to divide assets in the interests of fairness to both parties. 

What do the courts consider when deciding on a divorce settlement?

If you and your ex-partner cannot reach an agreement on how to divide your assets following divorce, you may need to ask the courts to intervene and make a decision on your behalf. If your divorce financial proceedings are heard by a judge in a family court, their starting point will be the Matrimonial Causes Act 1973 (MCA 1973). Under section 25 of the MCA 1973, courts must consider all the circumstances of the case, with the first priority being the welfare of any children. The judge will then consider a range of factors, including:

Factors the court considers for the parties (spouses):

• Each party’s income, earning capacity (including potential to increase it), property, and other financial resources
• Financial needs, obligations, and responsibilities
• Standard of living before the marriage breakdown
• Age of each party and length of the marriage
• Any physical or mental disability
• Contributions to the welfare of the family, including caring for the home or children
• Conduct, if it would be unfair for the court to ignore it, and
• Loss of pension or other benefits due to the marriage ending.
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Factors the court considers for a child of the family:

• The child’s financial needs
• The child’s income, earning capacity (if any), property, and other financial resources
• Any physical or mental disability of the child
• How the child was being, and was expected to be, educated or trained, and
• Relevant considerations for the parties (income/resources, financial needs, standard of living, disability)

The courts’ aim is always to balance fairness with financial need. In the landmark case of White v White, the House of Lords confirmed that there should be no discrimination between the breadwinner and homemaker, establishing the principle of fairness. More recently, the Supreme Court in Standish v Standish clarified that non-matrimonial assets are not normally divided equally, unless the court considers it necessary to use them to meet needs or provide compensation.

When is inheritance included in a divorce financial settlement? 

Inheritance may form part of the marital pot in several situations:

• If one spouse’s needs, or those of dependent children, cannot be met without drawing on inherited wealth
• If inherited money has been used to purchase the family home or cover joint expenses
• In long marriages, especially where both parties have relied on inherited funds

Inheritance received after separation is less likely to be shared, although it may still be considered if financial needs cannot otherwise be met.

So the bottom line is, if the needs of either party or the children from the marriage cannot be met by the marital assets, the judge will consider using non-marital assets such as inheritances. 

How can inheritance be protected in the event of divorce?

The courts retain discretion regarding whether inherited assets will be divided between divorcing couples, but there are steps you can take to protect your inherited wealth:

• Keep it separate – if you intend to keep your inheritance separate, avoid mixing it with joint accounts or using it for the family home
• Prenuptial and postnuptial agreements – nuptial agreements are not legally automatically binding, but they can carry significant weight since, in divorce, financial settlements
• Trusts - placing inheritance into a discretionary trust can create a degree of protection, though transparency is key.
• Evidence of intent - keeping records that inheritance was meant for one party only helps establish its non-matrimonial nature.

Alternative dispute resolution methods such as mediation or arbitration are increasingly used to resolve inheritance disputes without court intervention. Once a financial settlement is agreed, it should be formalised through a consent order or clean break order to ensure finality and prevent future claims.

Final words

The courts in England and Wales have wide discretion when it comes to how divorce financial settlements are reached and how assets are divided. If you are concerned about protecting or claiming inheritance in a divorce, the most important step is to seek specialist legal advice from a family law Solicitor.

For a free consultation regarding your divorce in the UK, please call us on 0208 300 6666.