What is the difference between marital and non-marital assets?

‘Marital’ or ‘matrimonial’ assets are those acquired during the marriage and typically split equally upon divorce, while ‘non-marital’ or ‘non-matrimonial’ assets are those deriving from a source seen as separate to the marriage, and so are therefore not typically shared in divorce, unless needed to meet a spouse’s needs.

For individuals considering or going through a divorce, it is important to understand the distinction between matrimonial and non-matrimonial assets, as the category an asset falls into can have a significant impact on a financial settlement.

What are ‘matrimonial’ or ‘Marital’ Asssets?

Matrimonial assets are those which have been built up over the course of a parties’ marital relationship - which in some cases, will be considered to have started before the parties legally married, if they cohabited beforehand and the cohabitation led seamlessly into marriage (learn more here).

Therefore, all assets acquired by either party from the point of pre-marital cohabitation to separation will generally be considered matrimonial and subject to the principle of equal sharing. This includes:

• The matrimonial home and any other property 

• Savings; and 

• Pensions

If you are considering or going through a divorce, click below for a free initial consultation with one of our expert divorce solicitors.

BOOK FREE CONSULTATION

What are ‘non-matrimonial’ or ‘Non-Marital’ Assets?

Non-matrimonial assets are those which are considered to derive from a source outside of the marriage, including:

• Premarital assets
• Post-separation accrual
• Inheritance

Premarital assets

Premarital assets are those which were not built up during the marriage but owned prior to its inception. If one party contributes significant premarital wealth to the marriage, this is likely to be taken into account when considering the fairest way to divide the assets. 

Premarital assets typically include: 

• Inheritance acquired before the marriage 

• Property owned before the marriage 

• A business founded before the marriage 

Since premarital assets are not immediately subject to equal sharing, it is often the case that the party bringing them into the marriage can retain them. However, if those premarital assets are required to meet the other spouse’s needs, for example their need to be re-housed, then the court is entitled to “invade” them, and they may well fall to be divided in the financial settlement. The court will usually take into consideration the standard of living enjoyed by the parties during the marriage when considering a spouse’s future needs. 

The importance of the source of premarital assets can diminish over time. There may be, for example, intermingling of premarital and marital assets, and this results in the premarital assets becoming “matrimonialised”. How the assets have been held and made use of by the parties is therefore extremely important, and relevant for the court to consider when exercising its discretion upon division. 

The way in which the courts view premarital assets is fact specific and depends on the circumstances and facts of each case. It is therefore extremely important that your case is framed in the best possible way from the outset and this is why it is so important that you have the right team on your side. 

The Marital home

The exception to this is the family home, which is considered separately and, in principle, shared equally between the parties regardless of legal ownership. If you are not a legal owner of your family home, you can apply to register your ‘matrimonial home rights’. This protects your right as the spouse of the legal owner and allows you to occupy the property pending conclusion of any financial proceedings. 

Occupation of the family home following separation can also be regulated, in some cases, by an occupation order. 

Post-separation accural

Post-separation accrual refers to assets gained by one spouse in between the period of separation and the conclusion of the financial settlement. However, just because a party has accrued additional wealth or assets during this period, does not necessarily mean it will be considered non-matrimonial. Its status depends on its relation to the marital partnership and pre-existing matrimonial assets. For example, if an asset acquired during the marriage increases in value post-separation, the growth will likely be considered matrimonial if it was passive growth. You can learn more by reading our dedicated guide to post-separation accrual.

Are inherited assets non-matrimonial?

Generally, inherited assets will be considered non-matrimonial. This means they will typically be ring-fenced and not subject to sharing, unless some sharing is required to meet a party’s needs.

why choose vardags?

Working exclusively with high and ultra-high net worth clients means that premarital wealth is often a significant factor for Vardags’ clients and we have the expert knowledge and experience of these cases. We know that deploying a well thought out argument at the very outset of a case in those circumstances is key and can make substantial difference. We have extensive experience of achieving the best outcome for clients and together with our inhouse forensic accounting team, who understand all the issues that arise in these cases, we can get the best outcome for our clients.