How are gifts handled when couples split up?

Christmas is all about giving – but what happens when the relationship doesn’t last? Who keeps the luxury watch? What about the car that was given as a present? And what if the gift was a treasured family heirloom? These questions can feel awkward and emotional, especially when you’re already dealing with the stress of separation.

Disagreements over gifts tend to crop up for a few reasons. Big-ticket items like cars, jewellery, or pricey tech can quickly become sticking points because of their value. Sentimental pieces add another layer of complexity – things tied to family history or special occasions often mean far more than their price tag. And when couples share finances, it’s easy for ownership to get muddled, making it hard to work out who actually paid for what.

The general rule

In England and Wales, a gift is something given freely, with no expectation of payment or return. For a gift to count legally, three things need to happen:

• Intention: The giver must genuinely mean to give the item.
• Acceptance: The recipient must agree to take it.
• Delivery: The item must be handed over.

Once these steps are met, the gift usually belongs to the recipient outright – and in most cases, it can’t be claimed back later. There are exceptions, though. If a gift was given on a clear condition (for example, an engagement ring given on the promise of marriage), it might need to be returned if that condition isn’t met. Similarly, if a gift was obtained through dishonesty or pressure, it can be challenged.

Gifts between couples

Arguments between couples often arise over gifts exchanged during the relationship. If one partner gave the other something significant – like jewellery or a car – it’s generally treated as the recipient’s property. But sometimes the intention behind the gift is questioned. Was it truly a gift, or more like a shared purchase or a loan? If this becomes an issue, courts may look at evidence such as receipts, messages, or the context at the time.

Disputes can also involve items both partners used, like household appliances or shared vehicles. If ownership is unclear, the court might consider:

• Who paid for it – was it bought by one person or jointly?
• Who mainly used it – was it clearly meant for one person?
• Any proof of intention – was it meant as a gift or shared property?

Common Scenarios

• Engagement rings: Traditionally seen as an unconditional gift, even if the wedding doesn’t happen. The exception? If the ring was given on a clear condition (e.g., "you keep this if we marry”), it may need to be returned.
• Family heirlooms: If an heirloom was gifted during the relationship, it usually belongs to the recipient. But if it was only loaned or meant to stay in the family, ownership can be disputed.
• Luxury items: Jewellery, designer bags, or watches given as gifts are usually treated as personal property. If bought jointly or from shared funds, they may be considered part of the marital assets.
• Cash gifts: Money from family or friends is normally treated as belonging to the person it was given to. If it was used for joint expenses (like a house deposit), it may be seen as a joint contribution.

Do gifts affect financial settlements on divorce?

Most of the time, gifts don’t make a big difference to the overall financial settlement. The Family Court focuses on fairness and meeting needs, not reclaiming Christmas presents. However very valuable gifts (like cars or property) may be counted as part of the assets and if a gift was clearly intended for both spouses, it might be treated as joint property. 

Are gifts matrimonial or non-matrimonial property?

When divorce proceedings start, both parties need to disclose their assets – including personal items worth more than £500. But disclosure doesn’t always mean the item will be treated as a matrimonial asset and therefore available to be divided. The court’s approach depends on where the gift came from.

1. Gifts between spouses: Usually treated as matrimonial property and included in the settlement.
2. Gifts from others: Less straightforward. A gift to the couple is usually matrimonial, while a gift to one person is usually non-matrimonial – unless it’s mixed with joint assets (for example, paying off the mortgage).
3. Inherited assets: Often kept separate as non-matrimonial, but the court can include them if needed to meet both parties’ needs.
   It’s worth noting that these are general rules, and the court has wide discretion. If matrimonial assets aren’t enough to meet needs, non-matrimonial gifts can be brought into the mix. Also, be careful not to turn a personal gift into a matrimonial asset by mixing it with joint property – for example, using gifted money to pay off the family home mortgage.

Avoiding conflict

The best way to prevent arguments is to plan ahead and keep things clear.

• Keep records: Receipts or notes can help if there’s a disagreement.
• Talk it through: Most couples can agree without involving lawyers.
• Consider sentimental value: Sometimes compromise is better than conflict.

Practical tips for avoiding disputes about gifts

• Make sure you keep receipts or written confirmation of the giver’s intentions for those high-value or sentimental gifts.
• If disputes arise, get legal advice early – a solicitor can help clarify your position.

Gifts can carry financial and emotional weight, and disagreements over them can add unnecessary strain during an already difficult time. By understanding the legal position and keeping communication open, you can reduce conflict and focus on moving forward. If you’re unsure about how gifts or other assets should be treated during separation or want advice on setting up a cohabiting agreement to avoid future disputes, contact our family law team. We’re here to help you find practical solutions.