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Get information for having conversations with your clients about divorce.

  • Technical Information

  • Topics to consider

  • Practical guidance on having divorce conversations


What should you talk about when it comes to Divorce?

Divorce is one of the life events we don’t usually plan for. In this section you'll find information to help you when you’re dealing with a client that is going through this, often difficult, time.

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Get information for having conversations with your clients about divorce.

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Pensions are often a couple’s biggest asset, after the family home. In this section you’ll find information to help you discuss how pensions could be impacted in the event of divorce.

Defined Benefit Schemes

The value of a Defined Benefit Scheme can’t be released immediately. So, as a starting point your client will need to get a Cash Equivalent Transfer Value from their scheme before divorce negotiations start.


When the court has finalised a divorce an existing Will may no longer be effective. 

So who will inherit the estate?

If your client didn't update the Will since settling the divorce and the sole beneficiary was the ex-spouse/ex-civil partner when they died the Will would be treated in accordance to intestacy rules.

If there are other beneficiaries named on the Will then the estate will pass to them in accordance to the individual's wishes.

What happens if a Will is not up to date?

It’s important to make sure your client understands that their Will is kept up to date so that their estate goes to the person/people they want it to.

Transferring assets

Tax on divorce is an area that most people probably don’t think about. But, it’s important that a client understands the impact to their individual tax situation when it comes to splitting/transferring assets.

  • Capital Gains Tax (CGT)

After a divorce has been finalised, ex-spouses may be liable to pay CGT on transferring their assets.  As each individual has an annual exempt amount of £12,000 (2019/20), anything over this amount may be subject to these CGT.

The inter-spouse CGT free relief applies to separating couples but only until the end of the tax year of permanent separation and after that the relief is lost.

Asset basic rate tax payers High rate tax payers
Property 18%  28% 
Other (excluding disposal of cars, currency and belongings with a value less than £6,000) 10%  20% 
  • Inheritance Tax (IHT)

Transfers between spouses are exempt from IHT. However, after a divorce has been finalised transfers between ex-spouses are treated as Potentially Exempt Transfers will usually be exempt from IHT if the donor survives 7 years.

Although it is possible to transfer any unused percentage of the IHT nil rate band (NRB) from a deceased spouse or civil partner to the surviving spouse or civil partner, no transfer is possible where the first death occurs after the couple have divorced.

Lasting Power of Attorney (POA)

Often you would choose your spouse to deal with your affairs when you die. In the case of divorce,  if you have chosen your spouse as your sole POA the existing Lasting POA will be revoked. It’s therefore important to make sure any Lasting POA is kept up to date.

Severing joint-tenancy

If joint-tenancy has been severed it won't affect any divorce settlement. The court has the authority to agree who will become the sole owner of the family home.

Case study

A practical example of what you should consider when a client is going through a divorce.


In this section you'll find Prudential news releases that relate to divorce.

Conversation starter

In this section you’ll find support to help you with your client conversations.

Next Steps

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