• November 28, 2023
 Protecting assets from divorce

Protecting assets from divorce

Around 42% of UK marriages end in divorce. With divorce rates in 2021 reaching their highest in seven years, this increase illustrates the importance of ensuring a stable financial future for clients where marriage is a concern.

Can they protect their assets in the event of a divorce – and if so, how can this be done? This article will provide you with some guidance on the topic.

Assets, ownership, and divorce

Deciding to get a divorce from a partner can be a very difficult time. One of the most stressful aspects of divorce tends to be the financial side of proceedings, having to divide up the assets and deciding which spouse keeps the family home. This is especially tricky in instances where an individual has inherited the home or brought significant assets with them into the marriage. It may not feel fair to have to split these assets equally in a divorce settlement when they were the sole property of an individual pre-marriage.

Trusts and divorce

Setting up a trust to preserve wealth for future generations is one of the most effective ways to protect family wealth from divorce.

The recent case of WX v HX heard at the Family Division of the England and Wales High Court (the Court) has highlighted that the manner in which assets are managed and utilised during a marriage can determine their treatment on divorce, resulting in outcomes that may seem unfair.

The case concerned an application for a financial remedy order made by the Wife (WX) against her Husband (HX). Both parties brought significant assets into the 33-year marriage; these were mostly from the husband’s career but included £14m deriving from the wife’s family. The couple’s combined assets totalled £55m.

During the marriage, HX’s assets had been incorporated into the matrimonial property as he used his income to meet the family’s outgoings, purchase their homes, and other assets. On the other hand, WX’s family assets were largely held in trusts of which she was a beneficiary. These were kept completely separate from the shared matrimonial assets. Although she used the income to meet some of her outgoings, the capital remained untouched.

Assets are categorised into two classes:

  • Matrimonial Assets: these originate from each party’s endeavours during the marriage. The stance on divorce is that matrimonial assets are shared equally.
  • Non-Matrimonial Assets: these derive from a source outside the marriage. These are retained by the spouse who brought them to the marriage.

The only caveat to this is that non-matrimonial assets may be shared where they have been ‘mingled’ with matrimonial assets, which is what happened in this case. HX brought £10m into the marriage, a combination of inheritance and pre-marital income, however, as this had not been kept separate and was used to support the family during marriage, they lost their non-matrimonial character.

The husband argued that, following the divorce, all of the assets should be shared equally. The wife argued that she should retain her family assets and that the remaining assets should be shared equally. The wife largely succeeded and left the marriage with significantly more than half of the couple’s assets.

A key fact of this case was the finding that the wife’s non-matrimonial assets had been kept separate and also protected by the trust, which allowed her to maintain her property bought pre-marriage.

Prenuptial and postnuptial agreements

There are further ways in which you can protect your assets. Entering into a prenuptial agreement before marriage, or postnuptial agreement afterwards, will help set out how assets should be divided between a couple in the event of a divorce.

Although it’s not something couples want to hear, it’s always important to factor in the possible implications of a future divorce. This will assist both parties in understanding their potential financial future.

CTT have an experienced Private Client team who can assist clients with ensuring the appropriate protections are in place in the eventuality of a divorce. Where clients already have planning in place and are concerned about the divorce of a Beneficiary, please contact the Client Care Team for further assistance.

For further, in-depth information on the above, sign up to our Trust Management Course.

This article was submitted to be published by CTT Group as part of their advertising agreement with Today’s Wills and Probate. The views expressed in this article are those of the submitter and not those of Today’s Wills and Probate.

CTT Group


  CTT Group is an established Legal Services firm providing multi-disciplinary support for the UK’s Professional Adviser community. Their expertise spans multiple areas of Law, Estate Planning, Finance and Tax matters. CTT Group is recognised as a leading figure in the industry due to their wealth of experience and technical knowledge in the legal and financial sectors. CTT Group is made up of six areas: CTT Professional Services: A specialised knowledge hub designed for the Professional Adviser community and CTT Group members. The Professional Services team will provide you with a bespoke training and support package to suit any business. This includes the New entrants team, Training, Estate Planning Team, Professional Indemnity Insurance Service & the Resource Hub. CTT Tax and Trust: a premium support system for the Professional Adviser community, providing professional executor and Trustee services. They specialise in Estate Planning, Tax and Trust matters and have a wealth of knowledge and experience in delivering the right solutions for your clients. CTT Legacy Software: Ground-breaking legal software that will change how you work. Legacy was explicitly designed with you and your business in mind, so it will seamlessly align with your needs. It can also be tailored to suit your business needs, giving you complete control over your client journey. CTT Legal: Providing innovative and modern solutions to even the most complex legal problems. CTT Legal offer comprehensive Legal advice alongside CTT Law; an SRA-regulated law firm and strategic partner of CTT Group. This includes Residential and Commercial Conveyancing, Litigation, Document production, Client care, Professional Executor & Professional Executor. CTT Accountancy: A newly established Accountancy firm that will work in partnership with you and your business. CTT Accountancy is a practice of highly skilled and experienced accountants with expertise in trust matters, uniquely positioned to offer your clients a range of accounting services, whatever their needs. CTT Private Client: Offering individual professional advice to high-net-worth individuals with various financial situations. Their specialist team have a wealth of knowledge and will work with you to understand your requirements and provide bespoke advice. Click here for more information: https://ctt-group.co.uk/ Contact: CTT Group Tel: 01926 514 390 Email: enquiries@ctt-group.co.uk Address: CTT Group, Gables House 62 Kenilworth road Leamington Spa CV32 6JX