Trusts in Divorce
Navigate trusts in divorce with clarity and confidence. Our specialist divorce solicitors help you protect and recover assets effectively.
Trusts in divorce: What you need to know
When going through a divorce, the presence of a trust can add complexity to financial settlements. Whether you are a beneficiary, trustee, or concerned about protecting assets, understanding how trusts are treated in divorce is essential. Our experienced divorce solicitors can guide you through these complexities with confidence.
What is a trust?
In simple terms, a trust is where one person holds the legal or registered title to an asset, but it is beneficially owned by someone else or by a pool of people, known as the beneficiaries.
Every trust starts with a “settlor” whose role is to create the trust and provide the assets. The settlor will then appoint trustees to look after and administer the trust on behalf of the beneficiaries.
Trusts are commonly set up for tax, asset protection, or inheritance purposes. When trusts intersect with divorce, specialist advice from divorce solicitors is essential to protect your interests.
What happens if there is a trust in my divorce?
A common question is whether trust funds can be protected from divorce, or whether a party can make a claim from their spouse’s trust.
The short answer is: it depends. The court will look at all the circumstances of the case and will need to establish whether the assets in a trust are a financial resource that is genuinely available to you, or to your spouse.
This is not always straightforward, as the trustees have a responsibility to protect the interests of all beneficiaries. Therefore, any request for capital or income may be declined if granting it would compromise the rights or interests of other beneficiaries.
There are many different types of trust structure – those most common including bare trusts, discretionary trusts, loan trusts and remuneration trusts. The court will need to consider the structure of the trust in question, which can include reviewing trust deeds, any letter of wishes and any existing patterns of distributions to establish the true nature of the trust.
If the evidence suggests that the trust assets would be made available to you or to your spouse, they are likely to be taken into account when considering a fair financial settlement. Our divorce solicitors have extensive experience in cases involving complex trust structures.
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We provide clear, strategic family law advice with practical and emotional support throughout your case. Our specialist divorce solicitors handle complex financial matters involving trusts, businesses, pensions, and international assets.
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Specialist trust expertise
We have extensive experience handling divorces involving complex trust structures, including offshore and nuptial trusts, ensuring your interests are fully protected.
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Our team works alongside tax, property, and company law specialists within Freeths to provide comprehensive advice tailored to your financial and family circumstances.
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We prioritise confidentiality and adopt strategies that minimise conflict, protect privacy, and achieve fair settlements efficiently.
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From initial consultation to resolution, we offer clear communication, practical guidance, and emotional support to help you move forward with confidence.
Can trustees refuse to release funds or provide information?
Potentially. Spouses going through a divorce have a duty to provide full and frank disclosure, usually in a court form called a Form E, and will be expected to provide information about the trust, but the trustees are not under that same obligation, especially if they are concerned about prejudicing the other beneficiaries. Information that could be requested from the trustees includes:
- Trust instruments
- Trust accounts
- Documents that show what assets are in the trust and where they are held
- Details of the settlor, trustees and beneficiaries
- Distribution details
- Communications between the spouse and the trustees
It is sensible for all parties, including in some cases the trustees, to take specialist legal advice where there is a trust involved in divorce, particularly if there are questions over a spouse’s entitlement. Our divorce solicitors can liaise with trustees and ensure compliance with disclosure obligations.
Offshore trusts
Offshore trusts can create an added layer of complexity. This is where a trust is established under the laws of an offshore jurisdiction, common examples being Jersey or the British Virgin Islands.
Offshore jurisdictions can have what is commonly referred to as “firewall protection” to protect trusts, meaning that the validity of the offshore trust will be determined in accordance with its local laws.
Courts in some jurisdictions may choose to cooperate with an order issued by an English court. However, in others, they may refuse to do so, as they often adhere to their own laws designed to uphold the integrity of their trusts. This can therefore create problems with enforcing a court order from England and Wales.
Whether you are the beneficiary or their spouse, it is important to take early advice on offshore trusts to establish how the law will deal with the issues. Our divorce solicitors have experience handling offshore trust disputes and enforcement challenges.
Does placing assets into a trust protect them upon divorce?
Some trusts are connected to a marriage, for example ‘nuptial trusts’ which are set up to provide continuing financial support to one or both spouses or their children as members of a family unit. Nuptial trusts can either be created in anticipation of a marriage, or after a marriage.
Determining whether a trust is nuptial or not depends on the facts and circumstances of the case. It looks at the intention behind settling assets into the trust, and the connection to the marriage. Nuptial trusts can be used to provide a matrimonial home, or income to the parties during their marriage or civil partnership.
Nuptial settlements are relevant in divorce proceedings because the court has the power to vary them for the benefit of the parties to the marriage or their children. The kind of orders the court can make over the property within the nuptial trust depends heavily on the facts, but includes:
- Removing one party as a beneficiary
- Transferring assets completely to one spouse
- Ordering new settlements to provide housing
- Lump sums
- Granting life interests
- Replacing trustees or protectors
Even if a trust does not qualify as a ‘nuptial trust’, it may still be considered a financial resource that the party who is a beneficiary has available to them. However, it cannot be varied by the court. Our divorce solicitors can advise on whether a trust is nuptial and what powers the court may exercise.
Client settlements
Resolving disputes over trust assets in divorce
In a case involving assets over £8 million, both spouses were trustees of family trusts intended for their children. The dispute centred on whether these trusts could be treated as matrimonial resources. We examined loan and discretionary trusts, assessed beneficiary rights and worked with tax specialists to restructure assets for a clean break.
Outcome: Our client achieved a fair settlement and clarity on future trust arrangements, avoiding significant tax consequences.
Uncovering hidden assets in an offshore trust
We acted for a wife in a long marriage where the husband disclosed that all assets were held in an offshore remuneration trust in Belize. He claimed significant tax sanctions would reduce the matrimonial pot. Our team analysed the trust structure, reviewed documentation and collaborated with internal and external tax experts to challenge this position.
Outcome: We secured a generous financial settlement for our client, ensuring her long-term security despite complex offshore arrangements.
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