Pension Sharing Calculator for Divorce
Pension sharing is one of the main ways pension rights can be divided on divorce. FairSplit helps professionals model indicative Pension Sharing Order percentages and compare projected retirement incomes.
The tool is designed for early-stage, without-prejudice discussions where family law and financial professionals need to understand the broad effect of different pension sharing options.
FairSplit helps professionals model indicative Pension Sharing Order percentages, compare projected retirement incomes, and identify when further PODE input may be needed.
What is a Pension Sharing Order?
A Pension Sharing Order is a court order that transfers a percentage of one party's pension rights to the other party. The receiving party obtains an independent pension credit in their own name.
Pension sharing can be a useful way to divide retirement provision, particularly where pensions form a significant part of the overall assets. However, the effect of a Pension Sharing Order depends on the pension type, the parties' ages, retirement assumptions and the wider financial context.
What does a pension sharing calculation show?
A pension sharing calculation models how different sharing percentages may affect each party's future retirement income.
FairSplit shows an indicative Pension Sharing Order percentage and compares the parties' projected retirement incomes before and after sharing. This can help professionals explain the broad effect of a proposed share and identify whether further expert analysis may be needed.
How FairSplit models pension sharing
FairSplit uses a PAG2-informed methodology and transparent financial assumptions to model pension sharing outcomes.
The tool is calculation-led and deterministic. It is designed to provide a clear, proportionate starting point for discussion, not to determine the final legal outcome or replace expert evidence.
FairSplit can include Defined Contribution pensions, Defined Benefit pensions and State Pension estimates where information is available.
Income equalisation and retirement income comparison
In many pension cases, the key question is not simply how pension values compare today, but what income each party may have in retirement.
FairSplit can model pension sharing outcomes by reference to projected retirement income. This can help professionals explore income equalisation scenarios and compare them with alternative settlement approaches, including offsetting.
Combining pension sharing and offsetting
Some cases may involve a hybrid approach, where part of the pension difference is addressed through pension sharing and the remaining difference is reflected through offsetting against other capital.
FairSplit can help professionals explore this interaction by showing the approximate offsetting effect of each £10,000 of non-pension capital. This can be useful where the parties are considering partial pension sharing, retaining certain pension rights, or balancing pension outcomes against housing or other capital needs.
As with all FairSplit outputs, this is indicative only and should be reviewed alongside the wider financial circumstances, legal advice and any required expert input.
When a PODE report may still be required
FairSplit is not a substitute for a PODE report. A pension on divorce expert may still be required where the pension arrangements are complex or where expert evidence is needed.
- • Defined Benefit or public sector pensions are involved.
- • There is a significant age gap between the parties.
- • Pension benefits are already in payment or crystallised.
- • There are guarantees, protected benefits or scheme-specific complexities.
- • Pension values are significant and small differences could materially affect settlement.
- • The parties need formal expert evidence for court proceedings.
- • There is disagreement about the appropriate pension sharing approach.
Information needed to run an analysis
To run a FairSplit case, professionals will usually need enough information to understand the parties' pension positions and the broad options being explored.
- • Names and dates of birth for both parties.
- • Pension types, such as Defined Contribution, Defined Benefit or State Pension.
- • Pension values, usually Cash Equivalent or transfer values.
- • Any known pension income, whether deferred or already in payment.
- • Whether any pension benefits have been crystallised, meaning benefits have already been accessed.
- • Whether either party has a preference to retain a particular pension, so that other pensions may be prioritised for sharing instead.
- • State Pension estimates, where available.
Pension sharing calculator FAQs
What is a Pension Sharing Order?
A Pension Sharing Order is a court order made on divorce that transfers a specified percentage of one party's pension rights to the other party. The receiving party obtains an independent pension credit in their own name.
How is a pension sharing percentage calculated?
A pension sharing percentage is usually calculated by comparing the parties' pension positions and modelling the effect of different sharing percentages. FairSplit provides an indicative percentage using a PAG2-informed methodology and standard financial assumptions.
What does PSO percentage mean?
PSO percentage means the percentage of the pension rights to be transferred under a Pension Sharing Order. For example, a 40% Pension Sharing Order would transfer 40% of the relevant pension value at the implementation date, subject to the scheme's rules and charges.
Can pensions be shared without a court order?
No. Pension sharing requires a court order. The parties may agree the proposed terms, but the Pension Sharing Order must be approved by the court and implemented by the pension scheme.
Does FairSplit calculate the final legal outcome?
No. FairSplit provides indicative modelling only. It does not determine the correct legal outcome and does not provide legal advice, financial advice, tax advice or expert evidence.
When is a PODE report needed?
A PODE report may be needed where pensions are complex, values are significant, or the parties require expert evidence. This may include cases involving Defined Benefit pensions, public sector schemes, crystallised benefits, guarantees, large age gaps or disputed pension assumptions.
Can FairSplit be used for public sector pensions?
FairSplit is not appropriate for modelling pension sharing against public sector pension schemes. Public sector pensions often involve complex scheme-specific rules, and specialist actuarial advice is strongly recommended. FairSplit may help identify that further expert input is needed, but it should not be relied on to calculate the appropriate sharing outcome for a public sector pension.
Can FairSplit compare pension sharing and offsetting?
Yes. FairSplit models both pension sharing and pension offsetting, allowing professionals to compare indicative outcomes side by side. This can help frame early-stage, without-prejudice discussions before formal advice or expert evidence is obtained.
Model pension sharing options with FairSplit
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Run a FairSplit caseAlso considering pension offsetting? See the Pension Offsetting Calculator.