The UK Supreme Court’s recent decision in Standish v Standish ([2025] UKSC 26) may not have involved a nuptial agreement, but it offers a powerful lesson on the risks of pursuing tax-driven wealth transfers without aligning them with robust family law protections.
In Standish, a retired financier transferred £78 million of funds, accrued pre-marriage, to his wife as part of an inheritance tax (IHT) mitigation strategy. When the couple later divorced, the wife sought to claim the full amount as matrimonial property. The Supreme Court ultimately ruled that the assets were not automatically matrimonial emphasising that tax planning alone does not establish shared ownership or intent.
Despite the outcome, legal professionals across disciplines agree: this case might have been clearer (or avoided altogether) had the couple executed a nuptial agreement clarifying ownership and purpose at the time of the transfer.
Such agreements may later influence whether the transferred assets are treated as matrimonial or non-matrimonial on divorce. Whilst this might affect the effectiveness of the tax planning, a well-drafted post-nuptial agreement could address potential tax risks and ensure the parties have weighed the legal and financial consequences.
It’s important to highlight that the court is not bound to enforce a nuptial agreement but it must still give it appropriate weight when making financial decisions. If the agreement was entered into freely, with proper safeguards, and is not unfair or leaving either party (or their children) in need, it is likely to be upheld. Even where a party succeeds in challenging an agreement, the mere existence of the agreement is still relevant, and their divorce settlement will likely still be lower than it would have been with no agreement at all.
Helen Davies, Senior Associate in the Family Law team at DTM Legal, said:
“This recent case highlights the growing need for collaboration between estate planners and family lawyers. Had a properly drafted post-nuptial agreement accompanied the £78 million transfer, explicitly stating that it was for tax efficiency and not intended to be shared in the event of divorce, the dispute might have been prevented. Tax planning shouldn’t occur in a vacuum. Family dynamics and legal protections such as nuptial agreements should ideally be considered at the outset, even if they are ultimately decided against.”
Final Thoughts
Standish v Standish reinforces that wealth protection strategies should not stop at tax advice. Without a supporting legal framework, particularly in marriages, even the best-structured tax plans can face costly challenges.
For high-net-worth individuals, combining nuptial agreements, accurate documentation, and cross-disciplinary advice remains the most reliable way to ensure asset protection and avoid litigation risk.
For advice on nuptial agreements or any other Family Law matters, please contact DTM Legal’s Family Law team through their website: www.dtmlegal.com.