Compensatory Allowance

The compensatory allowance is intended to offset the disparity in living standards caused by divorce. How to get it? How much is it? Here's our advice.

Who can get it?

All spouses who divorce may have significant financial consequences and may ask the judge to award a compensatory allowance.

This is possible regardless of the divorce procedure chosen by the spouses: divorce by mutual consent, agreed to conduct or irretrievable marital.

Thus, contrary to popular belief, in the context of divorce proceedings for misconduct, the offending spouse may not be denied the right to the compensatory allowance. However, if fairness dictates, the judge can refuse it, particularly in the case of a spouse's violence toward the other.

What is the amount?

The amount of the compensatory allowance is calculated based on the needs of those who demand it and the fortune of the spouse who pays it.

Also, there are certain details to be taken into consideration when determining the needs and resources:

- Age and health status of the spouses;
- Duration of marriage;
- Qualification and employment status according to the labor market situation in each respective areas
   of pensions;
- Career choices made by one spouse during cohabitation, choices for children's education or for promoting 
   the career of another;
- State of each spouse’s goods at divorce; and
- Existence of a potential wife.

Unless there are exceptional cases involved such as a seriously ill spouse, the amount generally does not exceed one third of the resources of the one who pays.

The benefit is a lump sum and is paid primarily in the form of capital. The amount is fixed or approved by the court at once for the sum of money or assignment of goods.  Moreover, there is the possibility in the form of payments over a period of 8 years. In this case, the payment amount is indexed as support.

Exceptionally, the benefit may be assigned by the judge as a life annuity. This is possible if the age or health status of the perceiver does not allow them to meet their needs. It can then be revised, suspended or removed if there is a significant change in resources or needs of the spouses involved.

What happens in case the debtor dies?

The compensatory allowance, whatever its form - principal, periodic payments or annuity - is levied on the estate and heirs are not personally liable for its payment. This means that if the amount of the estate cannot pay it in full, the debtor cannot ask the heirs to pay with their personal property.

Thus, if the compensatory allowance has been fixed as a lump sum payable by installments, the principal balance is levied on the estate. If the compensatory allowance has been set as an annuity, it is therefore replaced by a payable amount immediately.

Note:  Do not confuse support with the compensatory allowance. They do not have the same role, or the same characteristics. The compensatory allowance may be subject to a deduction from taxable income for the person who pays it. If you need any help with any kind of pensions divorce, you should do some thorough research beforehand, so that you are not caught off-guard.

The Maintenance Allowance

The maintenance allowance means everything that is indispensable to sustain us: food, shelter, clothing and medical care. Also, it refers to the education and training the children or adults who have not completed their training receive. The maintenance allowance may also include the costs of pregnancy and childbirth if they are not otherwise covered. It is mandatory for maintenance to be paid by the spouses for the children, therefore, there is no way out when it comes to this matter related to divorce and children.

Meeting the requirements is imposed by the sentence of nullity, separation or divorce and it is delivered after the processing of the relevant procedure and the person who is obliged to pay is set, the amount and the basis for updating (usually will be the Consumer Price Index), the period and form of payment.

The amount of alimony depends on two circumstances:

- The income of the person who is obliged to pay it.
- The needs of the beneficiary.

There are some European countries which have a legal scale for this alimony, but there are also others which do not have one, this alimony being established by the judge, according to personal reasoning and to the margins imposed by divorce law. Subsequently, this amount also may be increased or decreased depending on the judicial needs of the beneficiary and the increase or decrease of the economic resources of the obligor.

The changes in the amount of maintenance allowance are made through appropriate judicial procedures and they are not effective until the final sentence is pronounced. This includes, for example, that the spouse who pays the maintenance for the children, cannot by themselves alter the amount because their income has experienced a reduction: they have to apply for it in court.

The obligation to pay maintenance ceases when:

-  The obligation to provide it expires
-  Resources that are required are reduced to the point in which the survival of the payer and that of their
   new family are endangered
- The person receiving the allowance exercises a profession or trade or their economic situation has
   improved so that they do not need the maintenance allowance anymore
- If the one who receives the allowance makes some of the mistakes that lead to disinheritance
- If due to misconduct or lack of application for work, they lose their entitlement to allowance for the
  duration of their behavior.

In principle, the maintenance allowance should be paid until the children reach adulthood. However, if after reaching this age, they are still studying or have no means of subsistence, the children may require allowance until they are able to earn their own living.

In these cases, the recovery of maintenance should be performed by the child directly, but they may not do so on behalf of the parent with whom they live together.

For its part, the breach of the duty of support involves the initiation of the procedure for execution on the assets required and also generates criminal liability: the lack of payment for two consecutive months or for four non-consecutive months constitutes a crime of family abandonment and it is to be punished by imprisonment from 3 months to 1 year or a fine between 6 to 24 months.

It is always a good idea to consult a lawyer as the lawyer can give you the proper advice as to whether to initiate any kind of legal action or not.

The Alimony

The court sets spousal support to repair the economic imbalance that the marital breakdown can cause with one of the spouses. The pension is set up to compensate, for example, the dedication of one spouse to homecare and to their family for the entire duration of the marriage or partnership. The amount of the pension is fixed by the judge on the basis of the income and property of the person to satisfy.

In some European countries, there is not any tariff that the judge must comply with when determining spousal maintenance. Therefore, the judge can set a specific amount according to his or her sole discretion, within the range of the law. Also, there is no time limit, but its duration will depend on the duration of cohabitation and the recipient's ability to obtain their own financial resources to place them at a standard of living similar to that enjoyed during marriage. Thus, the recipient's work does not lead, in principle and automatically, to their extinction.

The alimony is sought in the divorce procedure when the perception of the spouses is not compatible with the maintenance payments. Therefore, the procedures for provisional measures shall be fixed for the disadvantaged spouse, the alimony being replaced by the alimony in the decree of separation and after the processing of the due lawsuit.

You can obtain the alimony established in the decree of separation in the procedures for divorce, but if it is not recognized in the separation procedure, it does not remain valid after the divorce.

The amount stated in the decree of separation is updated every year according to the change in the Consumer Price Index published by the National Institute of Statistics. The amount of the pension can be modified in court in cases where the beneficiary can improve or worsen their economic situation. These same circumstances may also lead to termination of alimony.

For its part, the liquidation of community property after separation or the divorce proceedings lead to the extinction of the board unless it concurs with a change in the economic circumstances of the obligor or the assets seized after settlement produce a return to overcome the imbalance that led to its establishment.

The non-payment of alimony, like that of child support, can result in the commission of a crime of family abandonment, which is punishable by imprisonment from 3 months to a year or a fine for 6 to 24 months.

It is always advisable to obtain the advice of a lawyer who, in view of the peculiarities of each case, will inform you whether to initiate the appropriate legal action for the pensions divorce or not.

Compensatory Allowance

Definition

A compensatory allowance may be awarded to one spouse by the decree of divorce, regardless of the divorce or the divorce grounds.

It is intended to compensate for the disparity that creates marital disruption in the lives of the respective spouses.

It has a fixed nature and takes the form of a lump sum or of a life annuity in exceptional circumstances.

In some cases, the judge can refuse if equity so requires:

-    depending on the situation of the ex-spouses,
-    or when the divorce is granted solely to blame the spouse seeking the benefit, under the particular
     circumstances of the marriage breakdown.

Determination of the compensatory allowance

Evaluation of the compensatory allowance

The compensatory allowance shall be assumed at the time of divorce and fixed according to the needs of the husband to whom it is paid and the other’s resources, taking into account their position on divorce and its development.

It can be determined by the spouses or, in case of disagreement, by the judge.

Determination by agreement between the spouses

The compensatory allowance is determined either by agreement between the spouses in case of divorce by mutual consent or it may result from an agreement between the spouses, an agreement approved by the judge if it respects the interests of the parties and children.

In both cases, the spouses are free to determine the form and manner of payment of the benefit for example,  pension for a limited time.
Determination by the judge

Divorce law imposes that the judge determines the compensatory allowance in case of disagreement between spouses.

It takes the following aspects into account:

-    duration of marriage,
-    the spouses’ age and health status,
-    their qualifications and their employment status,
-    consequences of career choices of either spouse during cohabitation for children's education and how
     long it will take to spend or to promote the spouse’s career at the expense of their own,
-    heritage estimated or expected of spouses, their respective positions on pensions...

The spouses must certify the accuracy of their resources, income, wealth and living conditions and the judge may require evidence.

Forms of payment

Payment of capital

The payment of capital is the general rule.

Failing agreement, the judge decides the terms of payment of the lump sum are:

-    the payment of a sum of money,
-    the allocation of property ownership or right to use temporarily or for life, habitation or usufruct.
     The debtor must agree to the allocation of ownership of any property received by gift or inheritance.

If the husband does not have sufficient cash to pay it once, he can be allowed to pour capital over several periodic intervals, within a maximum of 8 years.

An annuity

The benefit may exceptionally take the form of an annuity, where the personal circumstances of the beneficiary do not allow them to meet their needs, depending on their age or their health.

Payment of a mixed compensatory allowance

A "mixed" compensatory allowance can then be fixed by the judge, when the circumstances require it. In this case, the amount of the pension is reduced by the allocation of the capital.

Death of debtor

In case of death of the person who pays the benefit, the payment thereof shall be levied on the estate and within the estate.

Thus, the heirs are not personally liable for payment of the benefit.

If the benefit payments take the form of payable capital, it becomes payable immediately, by splitting the balance of this capital.

If it is an annuity, it also immediately converts the payable capital into the amount determined by a scale after the deduction of survivor benefits.

However, the heirs may decide to keep the settlement terms set before the death of the debtor by deed.

They are then required to make the payment of the benefit from their personal funds if the estate is insufficient.

How to get the payment

Obtaining payment of a compensatory allowance

When the compensatory allowance takes the form of an annuity, the procedures are the same as for the recovery of alimony. They include direct payments.  The applicant may request the assistance of the family allowance fund (CIF) or contact the State Treasury if the direct payment procedures and entry fees have failed.

Revision of the compensatory allowance

A lump sum paid in installments

In case of significant change in the debtor's circumstances, they may ask the judge to review the terms of payment.

Exceptionally, the judge may decide to authorize the payment of capital on a total period of more than 8 years.

The debtor may be paid at any time once the remaining maturities of capital are identified.

Benefit determined as an annuity

In case of significant change in one spouse’s situation (unemployment of the debtor, remarriage of the recipient...), the annuity may be revised, suspended or deleted.

The revision may not have the effect of raising the rent to an amount higher than the one originally set by the judge.

The debtor or, in some cases, the creditor may ask the judge to convert the pension capital. The amount of capital is determined by applying a scale fixed by decree.

The request must be made by motion to the family court of the defendant’s place. Each spouse shall make a return certifying the accuracy of honor of their resources, income, wealth and living conditions.