When a couple marries, many solely owned assets (or pre-acquired assets) will change in nature and may become treated as joint assets. These so-called matrimonial assets can then be contested in the event of a divorce, with both parties claiming a right to a share. As a result, many people are concerned about whether a spouse can take a share of inherited assets. We explore the reality of inheritance and divorce.
Can Your Spouse Take Your Inheritance?
In most cases, inheritance acquired during the marriage would be considered a matrimonial asset, meaning that it forms part of the “joint pot” that is open for division during divorce proceedings. As a result, inheritance is not automatically excluded, and the courts do have powers to make it available to ex-spouses in certain circumstances.
However, this depends on how the inherited asset has been treated during the marriage such as whether it’s been kept separate from the matrimonial assets.
What Factors Will Be Taken into Account?
When deciding whether inheritance should be open for division between ex-spouses, the court will look at a number of factors. These include the size of the inheritance and how it has been used during the marriage. Other considerations will include:
- How long you and your spouse were married.
- Whether inherited assets were transferred into joint names or if the couple or family benefited from the use of the inheritance. It may be deemed a joint asset if it was, for example, deposited into a joint bank account. The court can reasonably assume that the inheritance benefited the family, rather than the individual whom the inheritance was bequeathed to.
- Whether assets were received just before or during the breakdown of the marriage — in this case, they are less likely to be divided. (This is always subject
- to the needs of the parties and any children.)
- Whether the matrimonial (split) assets are enough to meet the couple or family’s needs. If the court deems that granting a share of the inherited or ring-fenced assets is necessary to satisfy those needs, it may do this.
The court will also base its decision on when the inheritance was granted. If the inheritance was received before the marriage and the other spouse benefited (for example, the inheritance was used to secure other assets, they may be able to make a claim).
Future Inheritance and Divorce
Typically, the parties’ future inheritance prospects do not become assets under consideration in the event of divorce. Again, however, there are exceptions. If the inheritance is imminent and/or likely to be substantial, the court may take this into account when determining the division of marital assets.
Protecting Your Inheritance
Where an individual may want to protect their inheritance from a claim during divorce proceedings, the ideal scenario is to enter into a prenuptial agreement before marriage or a post-nuptial agreement if the inheritance occurs during the marriage. As noted, it is also less likely that your inheritance will be considered a matrimonial asset if you keep it separate (“ring-fenced”) from any other marital assets during the marriage — for example, if it’s in your own name and not in a joint account, you do not use a property as a holiday home or you do not use rental income to meet the family’s income needs. It is also worth bearing in mind that reaching a financial settlement in divorce will help prevent claims from your ex-spouse in the event of a future inheritance.
If you or your spouse have recently inherited money or property, received an inheritance in the past or are expecting an inheritance and you’re considering a divorce, it’s vital to consult a specialist matrimonial solicitor. Contact KMJ Solicitors today to speak to our family law team about your case.