How are pensions split in a divorce?

After the family home, pensions are often the largest asset a couple has, and sometimes the largest of all. They are also the asset most likely to be overlooked, because the value sits out of sight for decades.

Where one of you stepped back from work to raise children, the gap between your pensions can be wide. In England and Wales, pensions built up during the marriage are usually treated as matrimonial assets whoever's name they are in, so you can ask for them to be taken into account.

There are three main ways:

• Pension sharing order. A percentage of one pension is moved into a pension in the other person's name. The money is then yours, and it is unaffected by what your ex-husband later does, including remarrying or dying.
• Offsetting. The pension stays with its owner, and you keep more of something else instead, often a bigger share of the house. This can suit someone who wants to stay in the home, but £1 in a pension and £1 of property are not equivalent, because pension money is usually taxed when drawn and can't be spent until later life.
• Pension attachment order. You receive part of his pension income or lump sum when he takes it. The Pension Advisory Group guide describes these as now rare. Under the Matrimonial Causes Act 1973, section 28, income payments under such orders end if you remarry or he dies, and you have no control over when he retires.

A share does not have to be 50/50. Pensions can be split to equalise capital value or to equalise the income each of you could expect in retirement, which can produce quite different percentages. In needs-based cases the court rarely limits the share to the years you were married. In Scotland, only the part of a pension built up during the marriage, up to the date you separated, counts as matrimonial property.

Ask each scheme for a cash equivalent transfer value (CETV), for your pensions and his. This is the figure courts and Form E use as the starting point. Schemes are allowed to charge for divorce-related information and for carrying out a sharing order under the Pensions on Divorce etc. (Charging) Regulations 2000, so ask about fees when you request it.

For a defined contribution pension, the CETV is roughly the pot's value. For a final salary (defined benefit) pension, especially a public sector scheme such as the NHS, teachers', police or armed forces schemes, the CETV can understate what the pension will actually pay. Dividing two CETVs equally can leave one person with much less retirement income than the other.

A Pensions on Divorce Expert (PODE) is usually an actuary or specialist who values the pensions and works out what share would achieve a particular outcome, such as equal retirement incomes. They are normally instructed jointly by both of you.

The Pension Advisory Group guide, widely used by family lawyers and judges, suggests a PODE report is usually needed where combined defined benefit CETVs exceed £100,000, and almost always in needs cases above £200,000. It also flags cases with uniformed service pensions, a big age gap, serious ill health or a large gap in State Pension. For smaller defined contribution pots between people of similar age, a report may not be needed.

Mostly not. For people reaching State Pension age on or after 6 April 2016, the new State Pension cannot be shared. Only a "protected payment", the part of someone's starting amount above the full new State Pension rate, can be shared, and many people don't have one. Older rules still apply to people who reached State Pension age before that date.

The court can still take a difference in State Pensions into account when looking at the overall split. Check your own State Pension forecast early, because gaps in your National Insurance record may be fillable.

The order is sent to the pension scheme, which carries it out. You then have your own pension, either inside his scheme or transferred to another pension, depending on the scheme's rules. Some public sector schemes only allow the share to stay within the scheme.

Decisions about where to hold a pension share, how to invest it and when you can take it make a real difference to your income later. This is a point where financial advice is often useful, because once the order is made the terms are hard to change.