One of the most common questions during divorce is: "What am I entitled to?" The answer depends largely on whether your assets are considered matrimonial or non-matrimonial, and whether there is enough to meet both parties' needs.
Understanding the difference between these asset types can significantly impact your financial settlement on divorce. For example an inheritance you received before marriage may be treated differently from the family home you bought together. Similarly money you earned during the marriage is viewed differently from a gift from your parents.
Here is what you need to know about how courts divide assets in divorce, and what "matrimonial" and "non-matrimonial" really mean.
What Are Matrimonial Assets?
Matrimonial assets are those built up during the marriage as a result of one or both parties' efforts. This includes anything acquired or grown in value during your time together.
Common examples include:
• The family home (even if in one name only)
• Salaries and bonuses earned during marriage
• Pensions built up during marriage
• Savings accumulated during marriage
• Businesses started or grown during marriage
• Investments made during marriage
The key principle with matrimonial assets is equal sharing. The starting point is that these assets should be split 50/50, though this can be adjusted based on needs and other circumstances.
Important: Just because an asset is in one person's name does not automatically make it non-matrimonial. For example, a house bought during marriage in your sole name is still likely to be treated as a matrimonial asset.
What Are Non-Matrimonial Assets?
Non-matrimonial assets are those brought into the marriage from outside, or received from external sources. These are generally protected from equal sharing, though not always completely ring-fenced.
Common examples of non-matrimonial assets:
• Inheritances received before or during marriage
• Gifts from family members
• Assets owned before marriage
• Compensation payments (e.g., for personal injury)
• Trust funds
• Family businesses predating the marriage
The general approach is that non-matrimonial assets should remain with the person who brought them in or received them. However, this changes if those assets are needed to meet the other spouse's reasonable needs.
When Non-Matrimonial Assets Get Divided
Non-matrimonial assets are not automatically protected. Courts will consider dividing them in certain situations:
1. When Needs Cannot Be Met Otherwise
If matrimonial assets are insufficient to provide for both parties' reasonable needs, courts may dip into non-matrimonial assets to make up the shortfall.
Example: Tom inherited £300,000 from his father during the marriage and kept it separate. The matrimonial assets (the family home and savings) are worth £250,000. His wife Sarah needs £275,000 to buy a suitable home and has limited earning capacity. The court may require Tom to share some of his inheritance because the matrimonial assets alone cannot meet Sarah's reasonable housing needs.
2. When Assets Have Been Mingled
If non-matrimonial assets have been mixed with matrimonial assets, they can lose their protected status. This is called "mingling."
Example: Lisa inherited £100,000 and put it into the joint account used for household expenses and mortgage payments. Because the money was been mingled with matrimonial finances and used for the family, it becomes harder to argue it should remain separate in divorce.
3. In Very Long Marriages
After a long marriage (typically 20+ years), the distinction between matrimonial and non-matrimonial assets becomes less important. Courts often view everything as "family money."
Example: David owned a business before marrying Emma 25 years ago. Despite the business being non-matrimonial in origin, the length of the marriage means the court is likely to treat it as a shared asset because they have built their life together around it for decades.
Understanding "Reasonable Needs" in Divorce
The concept of "needs" is central to financial settlements in divorce. Even if you have significant non-matrimonial assets, your spouse may have a claim if their reasonable needs cannot otherwise be met.
What Counts as Reasonable Needs?
Reasonable needs typically include:
• Suitable housing
• Income to cover day-to-day living expenses
• Funds for rehousing costs (moving, furniture, repairs)
• A car if necessary
• Pension provision for retirement
What counts as "reasonable" depends on the standard of living during your marriage. For example, if you lived in a £500,000 home, your needs will be assessed differently than if you lived in a £150,000 home.
Justifying Your Needs
During divorce proceedings, you will need to set out your monthly expenses and your capital needs (housing, car, furniture). The more detailed and justified your figures, the harder they are to challenge.
You should provide:
• A detailed breakdown of monthly expenses
• Evidence of your spending patterns during marriage
• Property searches showing realistic housing costs in your area
• Quotes for moving costs, furniture, and essential items
• Evidence of any special needs (health conditions, childcare requirements)
The court will not allow you to replicate your previous lifestyle if you cannot afford it post-divorce, but it will aim to ensure both parties can live reasonably comfortably.
How Courts Decide What to Do
When dividing assets, courts follow a structured approach:
Step 1: Identify All Assets
Everything must be disclosed. Both parties must provide full financial disclosure including property, savings, pensions, businesses, investments, and debts.
Step 2: Classify Assets as Matrimonial or Non-Matrimonial
The court looks at where each asset came from and how it has been used during the marriage.
Step 3: Assess Both Parties' Needs
What does each person reasonably need for housing and income? This includes considering children, earning capacity, age, and health.
Step 4: Apply Sharing Principle to Matrimonial Assets
Matrimonial assets are usually divided equally unless needs require a different approach. Needs can override equal sharing if one party requires more to meet their reasonable requirements.
Step 5: Consider Non-Matrimonial Assets if Needed
If needs cannot be met from matrimonial assets alone, non-matrimonial assets are brought into the equation.
Common Scenarios and How They Are Treated
Scenario 1: Inheritance Used for Family Home
Situation: Your father gave you £100,000 as a gift, which you used as a deposit on the family home.
Likely outcome: Because the money has been used for the family home, it has become mingled with matrimonial assets. It may be difficult to argue this £100,000 should remain separate, though courts may give you some credit for the contribution.
Scenario 2: Inheritance Kept Separate
Situation: You inherited £200,000 and kept it in a separate savings account that was never used for family expenses.
Likely outcome: This has a strong chance of remaining non-matrimonial. However, if your spouse cannot afford suitable housing from the matrimonial assets, the court may require you to share some of the inheritance.
Scenario 3: Short Marriage with Pre-Marital Assets
Situation: You were married for three years. You brought £500,000 in assets into the marriage, while your spouse brought £50,000.
Likely outcome: In short marriages, pre-marital assets are more likely to be protected. However, your spouse's needs will still be considered, especially if they gave up work or career opportunities during the marriage.
Protecting Non-Matrimonial Assets
If you want to protect certain assets from being divided in divorce, there are steps you can take:
- Keep Assets Separate - Do not mingle inherited or gifted money with joint accounts. Keep it in your sole name and avoid using it for family expenses.
- Get a Prenuptial Agreement - A prenup can specify that certain assets remain separate if you divorce. This is particularly useful if you are bringing significant assets into marriage or expect to inherit during the marriage.
- Document the Source - Keep records showing where money came from. Bank statements, inheritance documents, and gift letters help prove an asset is non-matrimonial.
What If You Disagree About Asset Classification?
It is common for divorcing couples to disagree about whether assets are matrimonial or non-matrimonial. One person might claim an inheritance was a gift to both of you, while the other insists it was personal.
If you cannot reach agreement through negotiation a judge will decide at a financial remedy hearing. The judge will review evidence about where assets came from and how they were used during the marriage. However, court proceedings are expensive and stressful. Wherever possible, it is better to negotiate a settlement with the help of solicitors or a mediator.
However, court proceedings are expensive and stressful. Wherever possible, it is better to negotiate a settlement with the help of solicitors or a mediator.
Getting Expert Advice
Working out which assets are matrimonial and non-matrimonial requires careful analysis of your financial history. An experienced family law solicitor can:
• Review your financial circumstances
• Identify which assets are likely to be protected
• Help you present your needs in the strongest possible way
• Negotiate on your behalf to achieve a fair settlement
• Advise whether court proceedings are necessary
The earlier you get advice, the better positioned you are to protect your interests.
If you are going through divorce and have questions about how your assets will be divided, speak to our team at Acclaim Family Law in Sheffield. We specialise in complex financial settlements and can help you understand what you are entitled to.
Call us on 0114 551 7555 or book a consultation online.
Quick Answers: Asset Division FAQs
Is my inheritance protected in divorce?
Generally yes, but not always. If your inheritance has been used for the family or if your spouse's needs cannot be met without it, the court may require you to share some of it.
What if the house is only in my name?
If the house was bought during the marriage or used as the family home, it is likely to be treated as a matrimonial asset regardless of whose name is on the deeds.
Can I keep money I earned before marriage?
In short marriages, pre-marital assets are more likely to be protected. In longer marriages, they may be treated as shared assets. It depends on how long you were married and whether the money was used for the family.
Do we split everything 50/50?
Matrimonial assets usually start at 50/50, but this can be adjusted based on needs. Non-matrimonial assets are only divided if needed. Every case is different.
What counts as reasonable needs?
Suitable housing, income for living expenses, a car if necessary, and pension provision. What is "reasonable" depends on your standard of living during the marriage.
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