Divorced partners who split pension benefits between them are to gain greater flexibility in how they can spend these retirement savings.
Government pensions reforms have been welcomed by insurer Standard Life.
The new legislation will mean that restrictions currently imposed on pension benefits between divorced partners are to be relaxed. Accordingly, when the changes come into effect next April, the person who did not originally make the retirement savings will be able to access the benefits before retirement age - and can also take them as a tax-free lump sum rather than as a taxable income.
Under current UK law, pension benefits are taken into account for any divorce settlement - which usually means that the benefits holder keeps them following the split, and gives their spouse an asset worth an equivalent value.
Less commonly, pension benefits themselves can be split between the partners. This can cause a problem when it comes to protected rights, with the spouse often not being able to access the split assets until he or she reaches the age of 60, and even then can only take them wholly as income rather than a lump sum.
The legislative reform will be beneficial to divorced wives, as it is usually the female partner that receives her ex-husband's workplace benefits when they are split rather than the other way around.
Andrew Tully, senior pensions policy manager at Standard Life, said: "This change is long overdue and will be especially beneficial to women, who are more likely to receive pension benefits as part of a divorce settlement. Giving people more flexibility to take pension benefits when and how it suits them best is a welcome development.
"When going through an emotional upheaval like divorce or separation, pensions are unlikely to be at the forefront of people's minds. But starting afresh can have serious implications on your financial future, so it is crucial to take expert financial advice."
Around one in three marriages end in divorce.
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