Financial settlements on divorce are difficult enough when assets are held in bank accounts, investment portfolios or property owned by one or both spouses. The process becomes considerably more complex when wealth sits within a trust, foundation, company or other structure.

The central question is not always, “Who legally owns this asset?” In many cases, the court must instead ask whether the structure provides a spouse with resources, whether it was created during the marriage, and how much weight it should carry when assessing the family’s financial needs.

Legal ownership is only part of the picture

A trust is not generally owned by its beneficiaries in the same way that a person owns a house or a bank account. Legal ownership usually rests with trustees, who manage the assets according to the terms of the trust. A beneficiary may have a fixed entitlement, a future interest or merely the possibility of receiving distributions.

Foundations can present similar difficulties, particularly where they are established in another jurisdiction and operate under different legal principles. A spouse may have influence over a foundation or receive financial support from it without holding a straightforward personal interest that can simply be transferred or sold.

This distinction matters because family courts typically cannot treat every trust or foundation asset as matrimonial property. However, that does not mean such assets are irrelevant. The court’s task is to reach a fair outcome, taking account of the resources available to each spouse and the needs of any children.

In practical terms, the court may examine:

• Whether a spouse has received regular payments from the structure
• Whether they can request or influence future distributions
• Who established the trust or foundation and for what purpose
• Whether the arrangement predates the marriage
• Whether other beneficiaries have genuine, competing interests
• How the family’s lifestyle was funded during the relationship

The answers can be more important than the label attached to the structure.

When can a trust become relevant to a settlement?

A trust may be treated as a financial resource if the evidence suggests that funds are likely to be made available to a spouse. This is sometimes described as a “resource” approach. The asset may not be included in the matrimonial pot in a strict sense, but the court can still consider it when deciding what each person can reasonably afford.

For example, suppose one spouse has historically received substantial payments from a family trust. The trustees have consistently supported their housing, education or general living expenses, and there is no indication that this support will stop. Even if the spouse cannot demand a specific sum as of right, the trust may be regarded as an important source of resources.

The position is different where the trust is genuinely independent, the spouse has little influence over it and distributions are uncertain. The court must avoid treating an asset as available simply because it might theoretically be accessible at some point in the future.

Timing also matters. A trust created before the marriage may be treated differently from one established using joint marital wealth. Equally, an inherited trust may remain separate in principle but still affect the overall settlement if it has been used to support the household or if the claimant spouse’s needs cannot otherwise be met.

The importance of disclosure and evidence

Trust-related disputes often become difficult because one or both spouses do not have complete information. Documents may be held by trustees, professional advisers or overseas administrators. The spouse connected with the structure may also argue that they do not control the relevant assets or cannot obtain confidential information.

That makes early disclosure particularly important. Useful material can include trust deeds, letters of wishes, accounts, distribution records, correspondence with trustees and evidence of loans or payments. Bank statements may help establish how the family’s lifestyle was funded, while tax documents can reveal income or benefits that are not obvious from a standard Form E disclosure.

If the structure is complicated, obtaining advice from experienced matrimonial finance lawyers can help clarify which questions should be asked and how the evidence may be presented. The aim is not to assume that every trust is available, but to distinguish genuine restrictions from arrangements that have been used to obscure resources.

Third-party interests can limit what the court does

A major challenge is that trustees and other beneficiaries may not be parties to the divorce. Their interests cannot simply be ignored. A court may be reluctant to make an order that effectively transfers trust property to a former spouse, particularly where the trust has several beneficiaries or was created for a wider family purpose.

This is one reason why the court may adopt a practical solution instead of attempting to divide the trust itself. It could, for instance, make a larger award from assets that are clearly matrimonial, while taking anticipated trust support into account when assessing the spouse’s future needs.

In some circumstances, trustees may be invited or required to provide information. If the court considers that a spouse has failed to use resources that are reasonably available, that may influence the outcome. But a court generally cannot compel trustees to distribute funds merely to satisfy a divorce award if the trust instrument and governing law do not permit it.

Overseas structures and enforcement risks

Foundations and trusts based abroad introduce additional complications. The court must understand the law governing the structure, the powers of its trustees or directors and the practical likelihood of enforcing any order in that jurisdiction.

An order that appears effective in England and Wales may be harder to implement overseas. Currency controls, confidentiality rules, local court procedures and different concepts of ownership can all create delays. It may therefore be necessary to seek specialist evidence from lawyers in the relevant country.

Tax is another consideration. Moving assets, winding up a structure or changing the way distributions are made can create tax consequences. These should be assessed before agreeing to a settlement, rather than treated as an afterthought.

A fair settlement requires a realistic picture

The most productive approach is usually evidence-led. Parties should identify what the structure is, who controls it, what has happened historically and what is realistically likely to happen in the future. Assertions on either side are rarely enough.

The court is not required to accept that a trust is either completely untouchable or entirely available. Its conclusion may sit somewhere between those positions, reflecting the structure’s legal terms, the family’s financial history and the needs of both spouses and children.

For anyone facing divorce where trusts, foundations or family wealth structures are involved, early preparation is essential. Understanding the difference between ownership, control and access can prevent unrealistic expectations and help focus negotiations on resources that can genuinely support a fair financial outcome.