Pension sharing

When a couple get divorced, the court has the power to rearrange their pension provision.  This can be done by way of a pension sharing order.  The court orders the trustees of the pension scheme to take a percentage of the transfer value of the pension and give it to the other spouse.

What happens next depends on the rules of the pension scheme.  Some schemes require the receiving spouse to become a member of that scheme, so that they have a pension of their own within the same scheme.  Other schemes require the receiving spouse to transfer their share out into another scheme. Some schemes give the receiving spouse a choice between the two.

If the finances of your divorce involve a pension or pensions, it will be necessary at the outset to obtain the Cash Equivalent Transfer Value (CETV) for every pension that either of you have ever had.  The spouse with the pension should ask their pension provider to supply the CETV for that pension.  Unless the provider has supplied a CETV within the previous 12 months, the CETV must be provided free of charge.

You should resist the temptation to start negotiating a financial settlement before you have the CETV of every pension.  This includes the Additional State Pension (formerly the State Second Pension and before that the State Earnings Related Pension – SERPS), for which you need to use Form BR20 which you can download from the DirectGov site at

At the moment it is not possible to obtain a CETV for a public sector pension.  The pension providers are revising their systems to take account of the Chancellor’s announcement in the emergency budget that in future all increases will be in line with CPI and not RPI.  When the providers have worked out how to deal with the change, they will resume providing CETVs.  This could be in October, but nobody is certain.