If you own your own business, it is essential to seek specialist legal advice if you are going through divorce proceedings. The expert divorce lawyers at Breakthrough Family Law can guide you throughout, taking a practical and strategic approach so that your business is protected.
Is my spouse entitled to part of my business in a divorce?
Historically, a family business was protected following a divorce but this is no longer the case. A business owned by one or both of the spouses is included in the assets to be divided between the parties. As part of the divorce proceedings, the business will have to be valued before financial settlement negotiations can get underway.
How will my business be dealt with during a divorce?
The way a business is dealt with will depend on the nature of the business in question. Some important considerations will be:
- Whether both parties are involved in running the business
- The way the business is run – as a sole trader, a partnership or a limited company
- Whether one or both of the spouses hold all the shares in the business or only a percentage
- Any property or assets owned by the business
- The status of other shareholders in the business – whether they are other family members or others with competing interests outside of the family
- Whether capital sums can be extracted from the business or borrowed against it
Should I seek legal advice to protect my business during a divorce?
It is vitally important you get specialist legal advice as early as possible to best protect your position. It is not unusual for business owners going through a divorce to panic and make changes to their business, believing this will help them protect it once divorce proceedings begin. In fact, doing this can seriously damage your position, particularly if these changes are designed to obstruct financial settlement negotiations. There are, however, legitimate steps that can be taken to reduce the risk of you losing part of your business in the course of divorce proceedings.
How does the court deal with divorce settlements where one spouse is a business owner?
Where possible, the court will usually look to leave the spouse who owns the business in charge and compensate the other spouse by giving them a larger share of the other assets. It may also ask the business-owning spouse to pay more in maintenance payments. Valuing a business can be tricky – unless the plan is to sell the business, any valuation will be an estimation. The court often takes a flexible approach, sharing income or shares where possible so that one party does not end up with all the cash assets and the other with assets tied up in the business.
Contact our Business and Divorce Solicitors Berkhamsted, Beaconsfield, Chesham and Chorleywood
Our experienced family law solicitors, serving clients in Beaconsfield, Berkhamsted, Chesham and Chorleywood, understand how stressful a divorce can be in addition to running and protecting your business. At Breakthrough Family Law, our expert divorce lawyers will listen to your personal and commercial needs carefully and prepare a robust strategy for their protection during divorce proceedings. We inspire trust and confidence in our clients by offering high-quality advice in a clear, straightforward and compassionate manner. Contact us today on 01494 776 696 or using our online form to arrange an appointment with one of our team.