When people go through the difficulties of a divorce, they tend to wish they could arrange the procedure in their home country, where they are familiar with the laws. However, in an international marriage that is not always possible. For example, a French woman is married to a German man and they live in the Netherlands. Both parties want to arrange the divorce in their respective home countries, yet due to European Guidelines, the divorce must be handled by Dutch courts. The Dutch Courts then decide on the law which will be applied to the divorce.
What steps should you take?
The first step you should take in the case of a pending divorce, is to find yourself a good divorce lawyer or mediator. In the Netherlands couples do not need to give the courts a reason for divorce and if you decide that you can no longer live with your partner for whatever reason, then this is considered a sufficient reason for divorce. The petition for divorce however will have to be filed in a court and normally this is handled by your divorce lawyer.
The next step is to make a (financial) plan. In the case of divorce, many things need to be considered, discussed and decided upon. Before you visit your divorce lawyer, mediator and/or financial planner, it is a good idea to draw up a list of assets/debts that need to be divided. For example, your list may look something like this:
- Marriage contract, if applicable
- Value of the marital home (or maybe second home), if applicable
- Life insurance policies
- Value of the contents of the home
- Other assets such as cars
- Bank accounts, debts and other loans
- Current pension situation (recent pension statement)
- Income of both parties
- Monthly outgoings
What about alimony/ spousal support?
This is always a huge issue and needs to be discussed for the sake of your ex-spouse and also (if applicable) your children. Another very important topic is that of the children's upbringing.
Home owners
If you are a home owner, you need to decide which of you will stay in the house. If the home is communal property, the surplus value (value of the home over and above the amount of the mortgage) will have to be shared. The same applies for any other assets, depending on whether or not a marriage contract applies. The spouse that stays in the marital home will have to be able to afford the mortgage on his or her single income. Bear in mind, this mortgage will probably have to be increased in order to pay off the other spouse.
If you are a tax payer in the Netherlands, the interest of this increase will be tax deductible. If after the divorce the ex-spouse wishes to continue contributing towards the interest payments, this will remain a tax deduction for another two years. (The ex-spouse will have to declare the so called “eigen woning forfait”). You should also consider the fact that any surplus value in the ex-marital home will affect future tax deductibility of the new home and of course the value of life insurance policies need to be considered as well. You should not hesitate in seeking the advice of a financial planner.
Regarding pension rights
Any pension rights built up during the marriage will have to be split too, as both ex-spouses have the right to half the pension built up during the marriage. Both ex-parters will be paid out directly by the pension fund or insurance companies when retirement sets in. Bear in mind, this does not apply to the A.O.W. (Dutch State Pension) as A.O.W. is paid out individually after the age of 65. (If you have not lived in the Netherlands since the age of 15, you will not be entitled to a full A.O.W.)
Once you and your spouse/partner have agreed on all points, the divorce court becomes a mere formality. In case either yourself or your ex-spouse have not reached an agreement on every point, the judge will have to decide. In case you do not agree with the judgement, you can appeal and ask the judge for a temporary arrangement. The judge will then decide on how much alimony will have to be paid and where the children will live for the time being.
Article by de Boer Financial Consultants. For financial advice when moving to the Netherlands, contact +31 (0)70 511 8788.