Can I Refuse Financial Disclosure

Can I Refuse Financial DisclosureI understand why sometimes clients ask, “Can I refuse financial disclosure.” Your relationship has broken down and now your ex, or your ex’s solicitors, are asking intrusive questions. You object because:

  • you’ve already reached a perfectly sensible agreement between you, or
  • you want your business, inheritance or pension left out of the settlement.

There’s a lot at stake so make sure you get expert legal advice

Why is financial disclosure requested

You’ll only know you’re getting a fair share of the matrimonial income and assets if you understand their extent. Your ex’s solicitor will be advising your ex the same. However this doesn’t mean your ex automatically gets a share of everything. When you disclose you can argue an asset is non matrimonial, for example:

  • an inheritance postdating the relationship breakdown, or
  • a pension you built up before the marriage.

See my blog Ring fence and protect assets on divorce

Further, if your business is small and represents your income, it’s unlikely it’ll be thrown into the mix. See my blog How to protect business on divorce.

What if you’ve already agreed a financial settlement

Did you know that the Court won’t make an order without seeing a Statement of Information for Consent Order. This is a Court form containing basic financial information about both of you.

What is a “Statement of Information for Consent Order” and why is it necessary

This document contains the following information from both of you:

  • details of marriage/civil partnership
  • dates of birth
  • financial agreement
  • summary of means
  • capital
  • income

The Court checks this document to make sure your financial agreement is fair and reasonable.

What if you provide inaccurate disclosure or hide assets?

See my blog Financial Disclosure on Divorce – 10 Things You Need to Know. This tells you about:

  • costs consequences, and
  • adverse inferences, and
  • the worst case scenario, being found to be “in contempt of Court”, and
  • the ultimate sanction, imprisonment.

Why do you need a consent order?

For more about consent orders and how to get one see my blog How do I get a consent order

Can I refuse financial disclosure

Contact Family Lawyer Joanne Houston on 01962 217640 for an initial consultation on Can I Refuse Financial Disclosure. In this 20 minute session she will review your situation and how you can achieve your objectives.

JUST FAMILY LAW are specialist divorce and family lawyers. We offer Pay as you go costs. We offer Collaborative law solutions tailored to your family’s needs.

The topics covered in this blog post Can I Refuse Financial Disclosure are complex. They are provided for general guidance only. If any of the circumstances mentioned in this blog apply to you, seek expert legal advice.

image for Can I Refuse Financial Disclosure Runner in Chicago by Kyle Cassidy on WikimediaThis image has been changed.

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How To Protect Business On Divorce – Sole Proprietor, Partnership, Ltd Co

 

How To Protect Business On Divorce

    How To Protect Business On Divorce

A client came to see us here at Just Family Law the other day. Let’s call him Ted. He and his wife were fine, he assured me. But he wanted to know what would happen to his business if they split up. “Would she get her hands on it?” They both enjoyed the highlife: holidays in Florida, villa in Spain. But it was all down to him, wasn’t it. There was no way she was getting a share.

“It all depends,” I said.

    Is The Business Shared Out On Divorce?

I told him his wife, let’s call her Sheila, wouldn’t automatically get a share of the business on divorce. Or rather I should say “his” business, as he was keen to remind me. But there were questions I needed to ask him first. Was it a partnership? A limited company? “No,” said Ted, “I’m a sole proprietor. Like I said, it’s my business.”

It was doing brilliantly, he told me, never better.

“So what is your business?” I asked him. “IT,” he said. He is responsible for the IT systems of a number of large businesses. One’s even a household name. He has an office full of “youngsters”, or so he calls them. They run the help desk. “Does Sheila have a role in the business?” I asked. No, she stays at home and spends the money.

Each morning brings a van load of online purchases to their front door.

    Business Valuations On Divorce

I advised him Sheila would want the business valued if it had assets. Valuations can be controversial and expensive. Maybe his company accountant could provide a valuation? Sheila might agree it. But if she didn’t, she would want a forensic accountant involved. Ideally they would jointly instruct one.

If it had a significant value Sheila could receive a larger share of other assets. Such as the savings or the family home. This would compensate her. And she’d have a hefty claim for maintenance too.

That’s if Ted’s eye watering boasts of his income were to be believed.

    Dealing With A Family Business On Divorce

He told me he had one final question. What difference would it make if he merged his business? A company was sniffing around. The managing director was planning his retirement. He’d promised Ted a shed load of shares. And a role for Sheila, too. And she reckoned she could make an even better job of running the business than Ted.

I advised Ted this could change everything. If the two of them ran it together she might want a share of it if they divorced. This applied to a limited company or to a partnership. But what would happen if the business couldn’t be split? The options were for one or the other to buy the other out. Or they could sell the business. They would need a valuation.

I reminded him about capital gains tax. 
The full tax implications should be considered if they decided to sell.

Ted wasn’t happy.

I told him maybe it wasn’t that bad. Perhaps he should consider a postnuptial agreement. He and Sheila could decide how all their assets should be split. And this could include their business assets and income. Collaborative law could help if they had trouble agreeing.

He said he liked the sound of that and would have a word with Sheila.

    How To Protect Business On Divorce

Contact Family Lawyer Joanne Houston on 01962 217640 for an initial free of charge consultation on the question How To Protect Business On Divorce. In this 20 minute session she will review your situation and how you can achieve your objectives.

JUST FAMILY LAW are specialist divorce and family lawyers. We offer Pay as you go costs. We offer Collaborative law solutions tailored to your family’s needs.

The topics covered in this blog post How To Protect Business On Divorce are complex. They are provided for general guidance only. If any of the circumstances mentioned in this blog apply to you, seek expert legal advice.

Image by Pierre Dalous on Wikimedia Commons

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