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Pension sharing on divorce policy

Introduction

This policy is issued by the Trustee of the Scheme.  It sets out information, which the Trustee is legally obliged to provide.  It also sets out other information, which you may find helpful e.g. details of the information that must be provided to the Trustee before it may act on any pension sharing order.

Pension sharing is available to couples that commence proceedings for divorce, annulment after 1 December 2000 or dissolution (in the case of civil partnerships) after 5 December 2005. It allows pension rights to be treated like other assets so that the whole or a proportion of their value may be transferred from one partner to the other as part of a financial settlement.

When a pension is shared, an amount, known as a pension debit, is deducted from the member’s benefits under the scheme. This debit is then used to create a corresponding credit for the member’s ex-spouse/partner.  This liability is immediately discharged by payment of a transfer value to another approved pension arrangement.

In order for pension sharing to take place it is necessary to obtain a pension sharing order or provision. Your solicitor will be able to advise you in relation to the steps you need to take in order to obtain such an order or provision.

If you have any queries concerning the information contained in this policy please contact:

DMGT Pensions
10 Bedford Street
Covent Garden
London
WC2E 9HE
Phone: (020) 7395 7272
Email: enquiries

Details of the value of benefits

The member’s entire pension benefits under the scheme pension will be included in the valuation of accrued benefits, which will be calculated in accordance with legal requirements.

Method of discharging liability for pension credit

If a pension sharing order is made, the Trustee will not offer the ex-spouse/partner benefits in the scheme.  Instead, the Trustee will immediately discharge its liability for the pension credit by transferring it to another approved pension arrangement.

The ex-spouse/partner must choose an approved arrangement to which the pension credit should be transferred.  A suitable arrangement must be chosen and the relevant discharge forms must be completed within three months of the effective date of the pension sharing order.  In the absence of such an arrangement being chosen and advised to the Trustee within this timescale the Trustee will select another approved arrangement.  In making such selection, the Trustee will have consulted its investment advisers and no commission will be paid.  However, there is no guarantee that the approved arrangement selected by the Trustee will be the most appropriate.

The Trustee is unable to offer any financial advice.

Charges

The Trustee will levy the charges detailed in the schedule of charges found at the end of this policy.

Charges should be paid in full before the Trustee will commence implementation of the pension sharing order.  If payment is not received then any outstanding charges due from the ex-spouse/partner will be deducted from the transfer value paid to the other pension arrangement.  Likewise if charges are outstanding from the member then the pension debit will be increased by these charges.

Where the member is not currently retired, then the first request for a value of benefits will be provided free of charge, but subsequent requests will be charged in accordance with the schedule of charges.
Where the member is currently retired then a value of benefits will only be made upon payment of the applicable fee shown on the schedule of charges.

The Trustee will allocate these charges between the two parties as directed by the court.  If the court makes no such direction, the member’s pension debit will be increased by these charges.

Other information
  1. Any pension sharing order must include a court stamp and should be immediately sent to the Pensions Administrator dealing with the case at the address detailed on the first page.

  2. The scheme has not commenced winding-up.

  3. The cash equivalent transfer value of the ex-spouse/partner’s pension rights would not be reduced in accordance with the provisions of Regulation 8(4)(b) or (12) of the Occupational Pension Schemes (Transfer Values) Regulations 1996.

  4. So far as the Trustee is aware, the member’s rights under the scheme are not subject to:

    1. an order or provision specified in Section 28(1) of the Welfare Reform and Pensions Act;

    2. an order under Section 23 of the Matrimonial Causes Act 1973;

    3. an order under Section 12A(2) or (3) of the Family Law (Scotland) Act 1985;

    4. an order under Article 25 of the Matrimonial Causes (Northern Ireland) Order 1978;

    5. a forfeiture order;

    6. a bankruptcy order;

    7. an award of sequestration on a member’s estate or the making of the appointment on his estate of a judicial factor under Section 41 of the Solicitors (Scotland) Act 1980.

    8. The member’s rights under the Scheme include no rights that are not shareable.

  5. The member is not a Director of .

  6. The Trustee may request information about the state of health of the ex-spouse/partner if a pension sharing order were to be made (the cost of obtaining such medical evidence is the responsibility of the member or ex-spouse/partner).

  7. Should the Trustee incur costs following the receipt of an inoperable order then these will be passed on to the member, ex-spouse/partner or solicitor.

  8. The Trustee will allow the member to choose a person to receive the pension credit benefit, including any lump sum which may be payable, if they should die before liability in respect of the pension credit has been discharged.
Information required by the Trustee

The Trustee must be supplied with:

  1. all the names by which both parties have been known;

  2. the date of birth, address and national insurance number of both parties;

  3. the current address, including postcode and telephone number of the ex-spouse/partner

  4. the member’s pension number of the scheme;

  5. the Decree Absolute, together with the Birth Certificate of the ex-spouse/partner, the Marriage Certificate and a signed copy of the Consent Order;

  6. the name and address of the approved arrangement to which the pension credit should be transferred (“the receiving arrangement”);

  7. the membership number of the receiving arrangement;

  8.  the name, title, business address, business telephone number, business facsimile number and e-mail address of a person who may be contacted in relation to the discharge of the pension credit.

All the above information must be supplied to the Trustee within three months of the pension sharing order being issued before steps can be taken to transfer the pension credit to the ex-spouse/partner’s chosen approved pension arrangement.

Final note

This policy contains important information concerning pension sharing on divorce.  Once the Trustee is in receipt of a pension sharing order, further requests for information may be made to the member or ex-spouse/partner.  Should the Trustee incur costs in making further requests for information then these will be passed on to the member, ex-spouse/partner or solicitor.

Schedule of charges

Item

Charge

Providing the initial cash equivalent transfer value where the member has a statutory right to receive such benefit.

Free

Providing an additional cash equivalent transfer value where the member has a statutory right to receive such benefit.

£150 +VAT

Providing a cash equivalent transfer value where the member does not have a statutory right to receive such benefit (for example retired member) or where the basis of the pension sharing order is different to the statutory cash equivalent transfer value (for example pension sharing orders made in Scottish Courts).

£750 +VAT

Providing additional information in response to specific requests following notification that a pension sharing order may be made or after receipt of the order.

£100 + VAT per question

Making additional requests for information when these have not been provided with the pension sharing order.

£25 + VAT

Implementing a pension sharing order where the ex-spouse/partner transfers to an arrangement of his or her choice.

£1,250 + VAT

Implementing a pension sharing order where the ex-spouse/partner transfers to an arrangement selected by the Trustee.

£1,500 + VAT

Note

All charges must be paid in full before any work can commence or taken from the transfer value paid to another arrangement in the case of the costs for implementing a pension sharing order.