Trusts and divorce solicitors

Our specialists help clients navigate the complex issue of dealing with trust assets during divorce or separation, ensuring their long-term financial security is protected.

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Trusts are often used to protect family wealth, plan for future generations, or manage assets for tax efficiency, but during a divorce, they can become a point of dispute. Whether you or your spouse are a settlor, a trustee or a beneficiary, trusts can complicate the financial settlement process and raise questions about ownership, control, and entitlement.

Our solicitors have experience in both family law and trust structures to help you understand your rights, assess how the trust might be treated in the divorce, and protect your interests as part of the financial settlement.

Different types of Trusts in divorce proceedings

Trusts can vary significantly in purpose and structure, and how they’re treated in a divorce will depend on their type and the surrounding circumstances. Here are some of the most common types of trusts.

Nuptial Settlements (Nuptial Trusts) - These are trusts that are created for the benefit of a couple during their marriage or in anticipation of it. Because they are closely connected to the marriage, the court has considerable powers to vary or redistribute the assets within the trust during divorce proceedings.
Intergenerational or Family Trusts - These trusts are often set up to preserve wealth across generations, for example, by parents or grandparents for the benefit of children and grandchildren. If one spouse is a beneficiary, the court may consider the trust a financial resource, even if they don’t have direct control over it, particularly if it has been used to support the couple’s lifestyle.
Offshore Trusts - Offshore trusts are established in jurisdictions outside the UK, often for tax planning or asset protection purposes. While these can be harder to access or enforce against, they are not exempt from assessment. Courts will still look at whether a spouse has access to or benefit from the trust, and may treat it as a resource in the divorce.
Sham Trusts - A sham trust is one that appears legitimate on paper but was never intended to operate as a true trust. These are often set up to hide assets or prevent them from being included in a financial settlement. If the court finds that a trust is a sham, it can disregard it entirely and treat the underlying assets as belonging to the individual attempting to conceal them.

Our divorce and trusts services

When trusts are involved in a divorce, our solicitors offer strategic guidance on a wide range of issues, including:

Assessing whether a trust forms part of the matrimonial assets.
Investigating the structure and purpose of the trust, including offshore and intergenerational trusts.
Challenging or defending claims that a trust is a ‘sham’.
Advising on the variation or restructuring of trusts during divorce proceedings.
Working with trustees to determine potential distributions or valuations.
Navigating the treatment of family trusts, especially where one party is a beneficiary.
Liaising with financial and tax experts to assess the impact of trust assets on the overall settlement.
Applying to the court to vary or set aside trust terms if appropriate.
Protecting trust assets from unfair claims or misuse in high-conflict cases.

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Trusts and divorce FAQs

Are trusts considered matrimonial property?

Trusts are not automatically considered matrimonial property, but they can be taken into account in a divorce depending on how they are structured and used. Key factors the court will consider include:

Whether a spouse is a beneficiary or has control over the trust.
How and when the trust was set up – for example, before or during the marriage.
How the trust has been used – especially if it supported the couple’s lifestyle.
Whether the trust is seen as a financial resource available to either party.

Can trusts protect an inheritance from your spouse?

Trusts can help protect an inheritance from a spouse in divorce, but they are not foolproof. If the inheritance was placed into a trust and kept separate from marital finances, the court may view it as non-matrimonial and less likely to be shared. However, if the trust has been used to support the couple’s lifestyle, or if one spouse is a beneficiary with regular access to funds, the court may treat it as a financial resource and include it in the settlement. Each case depends on how the trust was set up, who controls it, and how it has been used. Please get in touch with our experts and we will be able to assist you.

Can a trust be challenged in divorce proceedings?

Yes, a trust can be challenged within a divorce if there is evidence that it should be considered a financial resource or that it was created to hide or protect assets unfairly. The court will look beyond the legal structure to examine the trust’s purpose, how it operates, and whether one spouse has real access or benefit from it.

In some cases, the court may find the trust is a ‘sham’ which means it was set up to disguise ownership and then disregard it entirely.

Even if the trust is genuine, its value and potential benefit can still be factored into the financial settlement. Challenging or defending a trust in divorce is complex, please contact us as our specialists can help.

Can the court override or change the terms of a trust?

Under Section 24(1)(c) of the Matrimonial Causes Act 1973, the court has the power to vary or transfer a nuptial settlement as part of the financial settlement in a divorce.

If the court decides to intervene, it can:

Add or remove beneficiaries (for example, remove one spouse or add the other).
Change how or when assets are distributed.
Transfer assets out of the trust to one of the parties.
Restructure the trust to reflect the financial agreement in the divorce.

The court’s powers are limited, it can only vary trusts that are nuptial in nature, not those created independently, such as most third-party inheritance trusts. Also, while it can amend an existing trust, it cannot create a new one; if the trust is offshore or governed by foreign law, enforcement may be more difficult, though the court can still treat it as a financial resource.

What happens if the trust was created before the marriage?

If a trust was created before the marriage, it may be considered a non-nuptial trust, which limits the court’s ability to vary its terms. However, that doesn’t automatically exclude it from a financial settlement.

If the trust has benefited one or both spouses during the marriage, such as funding their lifestyle or being treated as part of the family’s wealth, the court may still regard it as a financial resource and take it into account when dividing assets. The key factors are how the trust has been used, who controls it, and whether either spouse has access to the funds.

I’m a trustee – how does that affect my responsibilities during a divorce?

If you are a trustee and one of the beneficiaries is going through a divorce, your role becomes particularly important. As a trustee, your duty is to act in the best interests of all beneficiaries and to manage the trust according to its terms. You may be asked to provide information about the trust and its assets, and possibly to give evidence in court. While you are not a party to the divorce, the trust itself may come under scrutiny, especially if it is seen as a financial resource for one of the spouses. It is essential to remain neutral and take legal advice to ensure you comply with your duties while protecting the integrity of the trust.

Why use our trust and divorce solicitors?

Tailored solutions and strategic negotiations - Our approach focuses on smart negotiation and strategic approaches to achieve fair outcomes while avoiding costly court battles where possible.
Specialists in complex Trusts and family wealth - We understand how trusts can complicate divorce. Our team has deep experience in unpicking trust structures, assessing entitlement, and protecting long-term family interests.
Multi-disciplinary support under one roof - As part of a full-service law firm ranked by Chambers UK and The Legal 500, we work closely with in-house specialists in private client, tax, and property to handle the most intricate trust and divorce issues seamlessly.