The court has broad discretion to determine the extent of the assets to be divided between the parties.
This does not, however, mean that a family business will be divided between the spouses upon divorce.
Do you need to value the business when dividing assets?
The value of the business is often crucial in terms of understanding the true wealth of your family’s assets. The way that a family business is valued can vary depending on the business structure. A common misunderstanding is that the cash in the bank account of the business is the same as the value of the business. This is not, however, always the case.
The accounts of the business will need to be analysed in order to ensure that there is a full understanding of the true worth of the business’s underlying profitability, goodwill value and/or income stream. Often there may be a business plan which will give an indication of the future anticipated growth of the business, this can be very useful in valuing a business and understanding the projected profitability.
In some cases, it is not necessary for a business to be valued if the reality is that the business relies on one person and the value of the business is an income-producing asset only.
What am I entitled to from the family business when dividing assets?
It is important that there is a clear understanding of the business so that the most appropriate strategy is adopted. Rayden Solicitors have a wealth of experience in dealing with family businesses and divorce, and can draw upon an expert team of accountants and barristers to assist if necessary.
The team at Rayden Solicitors will be able to advise you on what steps to take now, what preventative action to take if appropriate, and to understand what you may be entitled to.
We understand the commercial complexity of how businesses are set up and will explain how this can be dealt with upon divorce. We have successfully advised both business owners and their spouses in reaching settlements both in and out of court proceedings and have also concluded trials that have involved business structures.
We have experience in cases that involve:
Businesses wholly owned by the spouse
Businesses owned by the spouse and third parties
Complex business valuations
Complex tax issues
Complex issues concerning the appointment of a liquidator
Use of company assets to fund a settlement
Rayden Solicitors is also committed to equality and diversity and in doing so supports and advises all members of our community.