How are inheritances dealt with when a couple divorces?

Q.My wife and I are separating and intend to divorce. Shortly after we decided to separate, I received an inheritance of £150,000 from my late mother’s estate. Will this sum of money be included as part of our marital assets and divided between us when we divorce?

A. How inheritances are dealt with when a couple divorces will depend on their financial circumstances generally.

In many cases, all the assets of a marriage will need to be utilised to meet the parties’ needs for suitable housing, pension and income. If these needs can be met without using the inheritance monies then it is possible to argue that these funds should be ‘ring-fenced’. If funds are ring-fenced they will be kept separate from the marital assets and will be retained by the person who received them.

Inheritance monies are more likely to be ring-fenced if they were received at the time of, or following separation. If, on the other hand, the inheritance was received while the parties were still a couple and used for joint purposes, such as to purchase a jointly owned property, then it is very unlikely that the funds will be ring fenced.

To summarise, inheritance can be retained in its entirety by the spouse who received it, but this is usually only in cases where inheritance was received after separation and the parties’ financial needs can be met without it.

It is important to speak with a specialist family lawyer at the time of a separation to seek advice on how financial and property issues should be resolved.

For more information, or to discuss any aspect of family law, contact Janine Hutson on 01772 258321 or at janine.hutson@harrison-drury.com