Divorce Planning for HNW Couples: What Standish Changed and What to Review Now
On 2 July 2025, the UK Supreme Court handed down its judgment in Standish v Standish 2025 UKSC 26, upholding the reduction of the wife’s award from £45 million to £25 million.
The judgment provides important clarification on the treatment of non-matrimonial property, including pre-marital wealth, inheritances and gifts. It confirms that the source of an asset is an important starting point, but also that title, treatment, use and intention can all be relevant to whether non-matrimonial property becomes matrimonialised.
For HNW couples, the structural implications are significant. Pre-marital businesses, family wealth, trusts, pensions and tax planning transfers can interact with the divorce process in ways that the standard “split the assets” framing does not capture.
Divorce is also a major financial event. For HNW clients, the financial planner’s role is not to replace the family lawyer, but to help translate legal positions into sustainable post divorce financial outcomes.
What Standish v Standish held
The case concerned family wealth of approximately £132 million following the breakdown of a second marriage.
The husband had generated the substantial majority of the wealth before the marriage. In 2017, following inheritance tax planning advice, he transferred approximately £80 million of investment assets into his wife’s sole name. The intention was that she would settle the assets into trust for the benefit of their children. The marriage broke down before the trusts were established.
Mrs Standish argued that the transfer had matrimonialised the assets, turning them into shared marital property and making them subject to the sharing principle.
Mr Standish argued that the assets remained non-matrimonial because they had originated from his pre marital wealth and had been transferred for tax planning purposes rather than as a means of sharing the wealth between the spouses.
The High Court awarded Mrs Standish £45 million. The Court of Appeal reduced the award to £25 million in 2024, and the Supreme Court unanimously dismissed her appeal in July 2025.
The judgment provides several important principles for HNW divorce planning.
Source is important, but not determinative
The source of an asset remains the starting point in assessing whether it is matrimonial or non-matrimonial.
Property acquired before marriage, inherited by one spouse or received as a personal gift is generally more likely to be treated as non-matrimonial property. However, source is not the only relevant factor. The court may also consider title, use, treatment, contributions, intentions and whether the parties have treated the asset as part of their shared family wealth.
The sharing principle applies principally to matrimonial property
Non-matrimonial property is not ordinarily subject to equal sharing. However, that does not mean that non-matrimonial assets are automatically excluded from the overall financial remedy.
Non-matrimonial property may still be relevant where the court must meet the parties’ needs or consider compensation. The distinction is therefore important, but it is not an absolute guarantee that an asset will be excluded from the settlement.
The correct question is not simply whether an asset was originally non-matrimonial. It is also whether the parties’ needs can be met without using it and whether the asset has retained its non-matrimonial character.
Title is not conclusive
A transfer into a spouse’s sole name or into joint names does not, by itself, determine whether an asset has become matrimonial property.
The court will consider why the transfer took place, how the asset was subsequently treated and whether the parties’ conduct demonstrated an intention to share it as marital property.
This is particularly important for HNW couples who have transferred assets between spouses for tax, estate planning or family governance purposes.
Tax planning transfers do not, without more, demonstrate an intention to share
The Standish decision confirms that a transfer motivated by inheritance tax planning will not, without further evidence, normally demonstrate an intention to share the asset between the spouses.
That is relevant where assets are transferred between spouses because transfers between spouses are generally exempt from IHT. However, the purpose and surrounding circumstances of the transfer remain important. A tax planning explanation should ideally be supported by contemporaneous records rather than reconstructed after the relationship has broken down.
Why the distinction matters for HNW couples
For many couples, the matrimonial and non-matrimonial distinction may have limited practical significance because most of the wealth consists of the family home, joint savings and income accumulated during the marriage.
For HNW couples, the balance sheet is often more complex. One or both parties may enter the marriage with:
A successful business.
A family investment company.
Inherited property or investment portfolios.
Family trusts.
Significant pension rights.
International assets.
Pre-existing carried interests or shareholdings.
Wealth accumulated before the relationship.
The couple may also receive substantial inheritances during the marriage or transfer assets between themselves as part of IHT planning.
In those circumstances, the proportion of the family balance sheet that may be non-matrimonial can be significant. Standish provides greater clarity on when those assets may remain outside the sharing principle, provided they have been treated consistently as non-matrimonial and the parties’ needs can otherwise be met.
It does not create automatic protection. The practical strength of the position depends heavily on the evidence.
The risk of matrimonialisation
Non-matrimonial property can become matrimonialised through the parties’ use, treatment and conduct.
Use for family purposes
A pre-marital property used as the family’s main home for many years may be treated differently from an investment property retained separately.
Likewise, an inherited property used regularly as the family’s principal holiday home may create a stronger argument that it was treated as part of the shared family resources. The use of the asset does not automatically determine the outcome, but it may be relevant evidence of the parties’ intentions.
Mixing with matrimonial assets
Pre-marital savings paid into a joint account, used for general family expenditure or combined with marital income may create evidence that the asset was being treated as shared.
Mixing does not automatically destroy the non-matrimonial character, but it can make source tracking and intention significantly more difficult to establish.
Treatment as joint property
Where a pre-marital business is operated as a genuinely joint venture, with both spouses actively involved, compensated and involved in strategic decisions, the non-owner spouse’s contribution may become relevant to the treatment of the business.
That does not necessarily mean that the entire business becomes matrimonial property. The court may need to distinguish between the original value, growth during the marriage, active contributions and the parties’ wider needs.
Maintaining accurate records
HNW clients who wish to maintain a clear distinction between non-matrimonial and matrimonial wealth should consider whether their conduct is consistent with that objective.
This may include maintaining records of:
The original source of the asset.
The date it was acquired.
Its value at marriage.
Subsequent contributions.
Income and capital withdrawals.
Transfers between spouses.
Any changes in ownership.
The purpose of significant transactions.
The objective is not to create an artificial paper trail. It is to ensure that the financial history can be understood accurately if it becomes relevant many years later.
Where an asset is intended to remain non-matrimonial, clients should also consider whether it is being held and used consistently with that intention. This may include keeping pre-marital investments separately identifiable, using marital income for joint spending and avoiding unnecessary mixing with shared assets.
Separate ownership does not guarantee protection. Consistent treatment may, however, provide stronger evidence of the parties’ intentions.
This is not about concealing assets, frustrating a spouse’s claims or restructuring wealth unilaterally once separation is anticipated. Any planning must be transparent, properly advised and consistent with the parties’ legal obligations.
Document tax and estate planning transfers
Transfers between spouses for IHT planning, trust planning or family governance reasons should be documented at the time.
The records should explain:
Why the transfer was made.
Whether it was intended as a gift.
Whether it was part of an intended trust or estate plan.
How the asset was expected to be managed.
Whether the parties intended the asset to become shared marital wealth.
Contemporaneous documentation is generally more persuasive than an explanation prepared after divorce proceedings begin.
When pensions are material to the settlement
Pensions are an important consideration in many HNW divorces, but they are not necessarily the largest or most complex asset. Depending on the family’s balance sheet, the main planning issues may instead involve business interests, family trusts, investment companies, inherited wealth, property or international assets.
Where pensions are material, the principal mechanisms are:
Pension sharing, which transfers a specified share of pension rights into the other spouse’s name and can create separate pension rights while reducing the parties’ ongoing financial connection in relation to the pension.
Pension offsetting, where one spouse retains more or all of the pension in exchange for the other receiving a greater share of non-pension assets.
Pension attachment or earmarking, which redirects some pension benefits to the former spouse when they become payable but does not transfer ownership. It is therefore generally less attractive where a clean break is possible.
The underlying objective may be to equalise capital, provide broadly comparable retirement income or meet the parties’ respective needs. Those objectives do not always produce the same pension outcome.
The appropriate approach depends on the parties’ ages, pension types, access dates, income requirements, tax positions, liquidity needs and the composition of the wider settlement. A pension should not be valued in isolation or compared with other assets on a simple pound for pound basis.
Pension sharing
A pension sharing order transfers a specified percentage or amount of pension rights to the other spouse’s pension arrangement. It can create a clean break in relation to the pension itself, subject to the wider settlement.
For HNW couples, the analysis may involve:
The source and timing of pension contributions.
The value of benefits accrued before and during the marriage.
Defined benefit and defined contribution structures.
Previous crystallisation.
Pension protections.
Relevant lump sum allowances.
The practical implementation of the pension sharing order.
The post 6 April 2027 IHT treatment of unused pension benefits.
The 2027 IHT reform may be relevant to each party’s long term estate planning, but it should not be treated as a simple valuation adjustment in the divorce settlement.
Pension offsetting
Under offsetting, one spouse retains the pension while the other receives a greater share of non-pension assets.
This can appear straightforward but requires careful modelling. A pension and an investment portfolio are not equivalent simply because they have the same headline value.
The comparison may need to account for:
Access age.
Tax free cash.
Income tax treatment.
Investment returns.
Inflation.
Longevity.
Death benefits.
Liquidity.
Investment risk.
Other retirement income.
A simple pound for pound comparison can therefore produce an economically unfair outcome. Expert pension or actuarial input may be appropriate, particularly for large defined-benefit schemes or complex offsetting arrangements.
Pre-marital pension rights
The source based analysis may be relevant to pension benefits built up before marriage. However, a pension is not automatically divided into pre-marital and matrimonial components simply by reference to contribution dates.
Apportionment can be complex, particularly where there are defined benefit rights, transfers, investment growth, crystallisation or changes in employment. The calculation may also need to consider the parties’ respective needs.
A pension that partly predates the marriage should not automatically be treated as either entirely matrimonial or entirely non-matrimonial.
Business interests
For HNW couples with business interests, the financial and legal analysis is often particularly complex.
A business established before marriage may be non-matrimonial in principle. However, the position can become more complicated where:
The business grew substantially during the marriage.
The non owner spouse worked in the business.
The non owner spouse gave up their own career to support the business or family.
Marital funds were invested in the business.
Both parties made strategic decisions.
The business was treated as a shared family asset.
The business provided the family’s principal income.
Three structural questions are especially important.
Valuation
Business valuation in divorce proceedings is often contested. Asset based, earnings based and market multiple approaches may produce materially different results.
An independent expert valuation is usually essential, and the choice of expert can materially influence the quality of the analysis.
Matrimonial and non-matrimonial categorisation
Where a business pre-dated the marriage, the question may involve distinguishing between:
The value at the start of the marriage.
Passive growth.
Active growth during the marriage.
Contributions made by either spouse.
Capital introduced during the marriage.
The family’s needs.
The business’s original source remains important, but it is not necessarily the end of the analysis.
Practical settlement
Even where a business interest is partly matrimonial, forcing a sale may be impractical or destructive of value.
Possible settlement structures may involve:
Retained shareholdings.
Staged payments.
Deferred consideration.
Earn out arrangements.
Transfers of other assets.
Future income arrangements.
These structures require coordination between family lawyers, corporate lawyers, tax advisers and financial planners.
Pre-nuptial and post-nuptial agreements
Pre-nuptial and post-nuptial agreements are not automatically binding under English law, but courts generally give substantial weight to agreements where they have been entered into fairly and remain appropriate in the circumstances.
Relevant factors may include:
Whether both parties entered freely.
Whether there was full financial disclosure.
Whether each party received independent legal advice.
Whether the agreement was entered into sufficiently before the wedding.
Whether the agreement remains fair.
Whether it would leave either party or any children without their reasonable needs being met.
Standish strengthens the importance of documenting how the parties intend to treat pre-marital and inherited wealth, but it does not make a nuptial agreement unnecessary.
A well structured agreement can:
Record the parties’ intentions.
Identify specific business, trust or inheritance assets.
Reduce uncertainty about potential matrimonialisation.
Address future inheritances.
Establish a review mechanism.
Create an opportunity for wider family wealth discussions.
Pre-nuptial agreements are particularly relevant for second marriages, relationships involving substantial inherited wealth and marriages involving family businesses. Post-nuptial agreements can address the same issues where the conversation did not take place before marriage.
The cross disciplinary team
HNW divorce planning is inherently cross disciplinary.
The team may include:
A family solicitor leading the legal process.
A financial planner modelling settlement outcomes and future cash flow.
A specialist tax adviser considering CGT, IHT and trust implications.
Corporate counsel advising on business ownership and transfers.
A forensic accountant investigating income, assets or valuation.
An actuary assessing pension values and offsetting assumptions.
An investment adviser implementing the post-settlement portfolio.
The financial planner’s role is often underweighted.
The family lawyer focuses on the legal process and the available financial remedies. The financial planner translates possible settlements into long term financial outcomes by:
Modelling post divorce cash flow.
Comparing settlement structures.
Assessing liquidity.
Coordinating pension and investment decisions.
Considering tax consequences.
Identifying future capital requirements.
Building a sustainable investment and income strategy.
The adviser should not give family law advice, but should ensure that the financial consequences of proposed legal positions are properly quantified before settlement.
For HNW clients, the financial planner may be involved before marriage, during the relationship when ownership structures are being created, and during divorce proceedings when settlement alternatives need to be tested.
What this means in practice
If divorce is in prospect, or if a client wants to understand the structural protections available, three questions are worth considering.
Are non-matrimonial assets being tracked and treated consistently?
The Standish principles are most useful where the parties have treated the assets consistently as non-matrimonial throughout the marriage.
Mixing pre-marital wealth with matrimonial assets, using it for family purposes or treating it as jointly owned may create matrimonialisation arguments.
Are significant transfers documented?
IHT and estate planning transfers between spouses should have a clear contemporaneous record explaining their purpose.
Standish confirms that a transfer motivated by tax planning will not, without more, normally demonstrate an intention to share the asset. Documentation is still important because the court will consider the wider evidence.
Is the professional team already coordinated?
For HNW clients, the financial planner, family solicitor, tax adviser and any relevant valuation or pension specialists need to work together.
Identifying the team before a crisis arises is generally better than trying to assemble one after proceedings have begun. Good coordination can improve the quality of the financial analysis and reduce the risk that legal, tax and investment decisions are considered in isolation.
Conclusion
Standish does not mean that all pre-marital or inherited wealth is automatically protected on divorce. Nor does it make title irrelevant or eliminate the court’s ability to consider non-matrimonial assets when needs must be met.
What it does provide is greater clarity about the importance of source, treatment and intention.
For HNW couples, the practical response is to:
Maintain accurate records of matrimonial and non-matrimonial wealth.
Document IHT and estate planning transfers at the time.
Consider pre-nuptial or post-nuptial agreements.
Review business, pension and trust structures.
Establish a coordinated professional team.
This is not about anticipating divorce or trying to engineer a legal outcome. It is about ensuring that the ownership, use and planning of family wealth remain transparent and consistent with the intentions of the people who created it.
For HNW clients, that is not merely a legal issue. It is a core part of long term wealth planning.