Why Might you Need a Pension Report?

1. ‘Accurate Valuation’

Pensions have cash equivalent value, known as ‘CEV.’ This is usually calculated by pension scheme providers.

An accurate valuation is critically important when calculating the net value of marital assets. Pensions, especially those exceeding £100,000, are significant marital assets. A pension report provides a detailed and accurate valuation, which is essential for fair division during divorce proceedings.

2. ‘Complexity of Pension Schemes’

The process of calculating the percentage by which pension are to be shared to produce equality of income is very complex. The process requires work from a specialist pension expert, known as a Pension Actuary.

Higher-value pensions often involve complex schemes with varied benefits, accrual rates, and potential future growth. A pension report helps clarify these complexities and ensures all aspects are considered in the settlement. We will advise you on whether a specialist report is necessary or not.

3. ‘Equitable Division’

Specialist pension reports can help to identify significant gaps in equality of income between the two parties.

To achieve a fair financial settlement, both parties need a clear understanding of the pension’s value. A pension report, typically prepared by an actuary or a pension expert, details the current value and potential future benefits, aiding in equitable division.

4. ‘Pension Sharing Orders’

Since December 2000 Courts have been able to make pension sharing orders upon divorce. Pension sharing orders enable the court to divide pensions between parties.

It is a legal requirement that Pension Sharing Orders must be implemented within 4 months from the date that the court order takes effect.

If the court issues a pension sharing order, it needs precise information about the pension’s value and structure. A pension report provides the necessary details to implement the order correctly.

5. ‘Legal Compliance’

Courts require detailed and accurate financial information to make informed decisions. A pension report ensures compliance with legal requirements and provides the court with the necessary information to determine a fair outcome.

6. ‘Financial Planning’

Understanding the value and structure of your pension allows for better financial planning post-divorce. A pension report can guide decisions on how to split assets to ensure long-term financial security for both parties.

7. ‘Avoiding Disputes.’

Clear, comprehensive documentation from a pension report can help prevent disputes between parties, by providing an objective assessment of the pension’s worth. It removes room for doubt or further conflict.

In conclusion, a pension report is a critical tool for your solicitor when dealing with high-value pensions. It ensures accurate valuation, aids in fair division, and complies with legal requirements, ultimately securing your financial future post-divorce.