Dividing investments and savings when you separate should be straightforward if you’re not married or in a civil partnership. You might be able to claim back your contributions to them. You might also need to value them and pay tax or charges if you sell or cash them in.
How investments and savings are treated
Generally, any investments or savings in your sole name belong to you alone. And any owned in your ex-partner’s sole name belong to them alone.
But if you've contributed towards their solely owned assets, you might be able to make a claim for a share (and vice versa).
England, Wales and Northern Ireland
In England, Wales and Northern Ireland, you can only claim a share of your ex-partner’s assets if you can show you have a ‘beneficial interest’ in them.
This means either:
- there was an agreement that you'd share ownership, or
- you contributed something that the law recognises as giving you a stake, like money or work on a property.
There's no fixed deadline, but the sooner you act, the easier it is to show what was agreed or what you put in.
These claims can get complicated and expensive, so it's worth getting advice early from a solicitor who specialises in family law. You might also want to consider mediation.
Scotland
In Scotland, you could make a financial claim for a share of your ex-partner’s assets if you lived together as a couple without being married or in a civil partnership, known as ‘cohabitants’.
To make a claim, you need to show either:
- you’ve suffered ‘economic disadvantage’ – meaning you’re financially worse off as a result of the relationship. For example, you gave up work to raise your shared children.
- your ex-partner has gained an ‘economic advantage’ as a result of the relationship – meaning your ex-partner was able to gain financially because of your contributions or sacrifices during your time together.
You have one year to make a claim from the date of your separation.
You may want to consider mediation to help you and your ex-partner reach an agreement on your finances.
In Scotland, you can't ask the court to transfer a property from one person to the other. But if you can show a financial claim, you may be able to be paid a ‘capital’ lump sum to help rebalance the financial contribution made during the relationship.
If you jointly own a home and can't agree on what to do with it, it will need to be sold. If one of you wants to sell but the other won't agree, you can apply to the court to force the sale.
You might also need to arrange for any investments to be valued.
Find out more in our guide How to protect your finances during separation if you were living together
Dividing savings accounts
If you’ve agreed how you’ll share money you’ve saved in your own or joint names, it’s important to understand your options for doing this when you separate.
The process might be different – depending on the type of account you have and whose name it’s in.
You might have the following:
Cash ISAs or Lifetime ISAs
These can only be held in one person’s name – and not jointly.
If you want to give your partner money from your Cash ISA, you’d have to take the money out of the ISA. You can't transfer it from your own ISA account directly to theirs.
With a Lifetime ISA (LISA), you could take out the money you need but you’ll have to pay a withdrawal charge. As with a Cash ISA, you couldn’t transfer money in your LISA to someone else’s.
Savings accounts and NS&I
These savings accounts are more straightforward as you could just transfer some money from your account to your ex-partner’s.
The only difficulty might be if the money is in an account where you have to give notice. If that’s the case, talk to your bank or building society to understand your options to take out your money. If you don’t, you could lose some of the interest.
If the money is in a fixed-rate savings account, you might not be able to cash it in before the term is up. Even if you can, you might lose a lot of interest.
Some National Savings & Investments (NS&I) savings accounts allow instant access to your cash, while there might be a charge if you wanted to cash in a fixed-term bond early.
Junior ISAs
If you've opened a Junior ISA account for your child, then this money will be in your child’s name, and belong to your child.
However, if one parent moves their money into a child's account to try and keep it out of a financial settlement, a court can look at where that money originally came from and treat it as part of the split.
How to divide investment property
An investment property – such as a buy-to-let property or a holiday home – owned in your name or your ex-partner’s name alone belongs to that person. This is unless you can show you’ve made contributions towards it.
Try to negotiate how these contributions will be paid back, for example through mediation. Otherwise, it’s worth getting legal advice to assess your claim.
If you and your ex-partner own an investment property jointly, you’ll need to get it valued. This will help you both work out whether you want to sell it or to continue owning or renting it out.
If you both agree, you can contact your lender if you want to take your name or your ex-partner’s name off the mortgage.
You might need to remortgage, and talking to a mortgage adviser can help you understand your options. Keep in mind that lenders will need to assess your affordability whether you’re remortgaging or applying for a new mortgage - find out more in our guide Remortgaging to get the best deal.
If you own a property together but can’t agree what should happen to it, you can ask the court to decide.
Depending on where you live in the UK, a court can look at the situation and, where the law allows, decide whether the property should be sold or how each person’s share should be dealt with.
Find out what you could borrow in our guide Buying a home - what mortgage can I afford?
Valuing your investments
If you have investments, you should get a statement every year telling you how much they’re worth.
But this might not be the same as the amount you would get if you cashed in or transferred your investments.
Instead, depending on the type of investment, the value might be the:
- transfer value, or
- surrender (cash-in) value.
Your first step should be to ask the investment company for an up-to-date valuation, or transfer or surrender value.
You might have:
- bonds
- investment bonds
- stocks and shares ISAs
- with-profits policies, such as an endowment
- unit trusts, investment trusts or OEICS (open ended investment companies).
Understanding the costs of cashing in investments
Cashing in your investments might not be the best option – because you might have to pay tax and extra charges.
- You might have to pay Capital Gains Tax (CGT) if you cash in or sell an investment and make a profit. You have an annual CGT allowance, which means you can make a certain amount of profit – after selling costs and fees are deducted – before you have to pay tax. You don’t have to pay this tax if you’re selling your main home or on stocks and shares ISAs. This is a complicated area so it’s probably worth getting advice from an independent financial adviser or accountant. You’ll have to pay for their advice.
- Depending on your investment, you might have to pay charges if you sell or cash it in early. Even if you don’t have to pay a charge, you might lose out if you sell share-based investments when the stock market is low.
For more information, see our guide How to find a pension or retirement adviser
If you own shares, you can either transfer them to your ex-partner or sell them so you can give your ex-partner the money instead.
It’s worth getting advice from an independent financial adviser or accountant about which is the best option:
- You can transfer shares to your ex-partner by filling in and signing a ‘stock transfer form’ – also known as a ‘J30’ form. You might be able to download this from the website of the company you own shares in. Your ex-partner might have to pay Stamp Duty.
- If you have a stockbroker – or use an online stockbroking firm – they can arrange to sell the shares for you. Make sure you find out how much this will cost. You might also be able to sell through a share-dealing service offered by the company you own shares in. Not all companies offer this service.
Giving away assets to your ex-partner
If you give away an asset – for example, an investment that you have made a profit on – you might have to pay CGT.
If you’re married or in a civil partnership, you can usually transfer assets between you without paying CGT. If you separate, tax-free transfers can still be made for up to three tax years after the year you split up. Transfers made as part of a formal divorce or dissolution settlement can also be tax-free.
If you’re not married or in a civil partnership, these rules don’t apply. If an asset has gone up in value since you got it, CGT may be due when it's transferred to your ex-partner.
Your next step
It’s worth reading our guide Review insurance for dependants and your will on separation if you were living together.
