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Limited companies and divorce settlements

Expert advice for limited companies and divorce settlements

Divorce Advice for Business Owners

If you’re a business owner, it’s highly likely that your company will be considered as part of the financial proceedings when getting divorced or dissolving a civil partnership. Our specialist divorce solicitors have ample experience in dealing with complex matters including protecting your business in a divorce.

We can offer comprehensive guidance, supporting you to handle your business assets when getting divorced or dissolving a civil partnership. No matter what the specifics of your situation, we’ll ensure that you understand your full range of options, helping you to achieve the most favourable outcome.

For a free 30-minute initial chat with one of our expert divorce solicitors, call Woolley & Co on 0800 321 3832 or complete our online form.

Our experts can support clients with limited company divorce settlement matters, including:

  • Protecting your business in a divorce
  • Business valuation during divorce
  • Divorce and the family business
  • Mediation processes to reach a financial settlement
  • Representation in court proceedings
  • Pre-and post-nuptial agreements

Speak to us about limited companies and divorce today

Take advantage of a free 30-minute telephone appointment to talk through your situation. We will explain your options and how we can help. You will find that our lawyers are friendly, approachable and knowledgeable.

You can call Woolley & Co on 0800 321 3832 or complete our online form.

How our limited company divorce settlements solicitors can help you

Protecting your business in a divorce

If you’re going through a divorce and you’re concerned about the implications for your business, our specialist solicitors can provide you with expert advice tailored to your circumstances. Limited company divorce settlements can be incredibly complicated, particularly if there is some level of conflict between yourself and your ex-partner.

We appreciate that you may be concerned about what could happen to your business and that you’ll want to protect the company that you’ve built. Our experts can offer company directors and owners divorce advice to make sure business assets are protected.

Business valuation during divorce

If you’re getting divorced and you or your partner owns a limited company, it’s important that the company is valued correctly so that it can be properly factored into the division of assets.

At Woolley & Co, we can help to achieve a fair, independent valuation for a business based on the operational income and capital assets. As well as reviewing the company accounts, the valuation process involves assessing cash flow and comparative company models.

Our solicitors can liaise with accountants on your behalf, taking into consideration various factors while also reviewing the tax implications. We’ve supported many individuals with limited company matters on divorce, so can talk you through all of the issues and give you a clear appreciation of your legal standing.

Take advantage of your free 30-minute consultation with our expert divorce settlement lawyers. Call 0800 321 3832, or complete our quick online form.

Divorce and the family business

Where a divorcing couple own and run a family business together, dividing the business between the two parties can be complicated. Where you are facing this predicament, both parties are advised to gain independent legal advice early on.

Our solicitors can offer expert guidance and support divorcing couples in this situation. There are several options to divide a family business during a divorce, for example:

  • One individual ‘buys out’ the other
  • One person takes sole ownership of the business, while the other accepts a maintenance or compensation payment
  • One party carries on operating the business and transfers shares to the other party
  • The business is sold, and both parties split the proceeds
  • Both individuals decide to become shareholders and enter into a shareholder’s agreement

Call Woolley & Co on 0800 321 3832 or complete our online form for help.

Mediation processes to reach a financial settlement

Our family lawyers can help you to reach a limited company divorce settlement as part of your divorce proceedings. We can assist you through a mediation process, supporting you to negotiate with your partner and avoiding a court hearing if possible.

Reaching a settlement can be difficult and there are various underlying factors which must be taken into account. We will ensure that you have all the information you need to understand the procedure and prepare yourself. Together we will work towards the best divorce settlement to suit your needs.

Representation in court proceedings

Under some circumstances, it may be necessary to go to court to reach a financial settlement, particularly if there is dispute regarding your divorce and limited company. We understand that the prospect of a court hearing can feel overwhelming and are here to offer constructive and sensitive guidance throughout the entire process.

Call Woolley & Co on 0800 321 3832 or complete our online form for support.

Pre-and post-nuptial agreements

If you’re entering into a marriage and you’d like the option of protecting your business interests, we can support you to create a pre or post nuptial agreement. A pre-nuptial agreement is a legal document that’s drafted before you get married. The document outlines how assets would be shared in the event of a divorce. A post-nuptial agreement includes the same information, however, it is drawn up after the couple have married.

When you’re preparing to get married you probably won’t be thinking about the prospect of a divorce. Regardless, making these plans now can help you to protect your future interests and potentially your business if you do get divorced later down the line.

For a free 30-minute initial chat with one of our pre-nuptial agreement solicitors, call Woolley & Co on 0800 321 3832 or complete our online form.

Limited company divorce settlements FAQs

What happens to a ltd company in a divorce ?

During a divorce, a limited company may count as a marital asset depending on the circumstances. To reach a financial settlement the resources of both individuals are considered and then split based on various factors. These factors may include financial obligations, the needs of each party and their children and the living standard prior to the separation.

If one individual owned the company prior to the marriage, that person can put forward the argument that it should not be considered a matrimonial asset. However, in most cases, the business is likely to be considered a financial resource and its value or income producing potential will be taken into consideration for the division of finances.

This does not mean that the business needs to be sold or that the spouse who did not have a stake in the business will be given one in the divorce. It is more common for the spouse who is not involved in the business to be given a bigger share of other assets, such as the family home, to counterbalance the value of the business. However, other approaches can also be used depending on the situation.

Am I entitled to half of my husband's or wife's business if we get divorced?

Theoretically speaking you could claim that you are entitled to half of your spouse’s business if you are getting divorced as will all other assets. In practice, courts are generally reluctant to order individuals to sell their business and split it, especially when there are fairer and more practical options.

A company will likely be considered when reaching a financial settlement, but as mentioned above, it is likely another solution will be found to achieve a fair division of assets. This might include agreeing that you can retain a larger share of other assets or that you will receive regular spousal maintenance payments.

Regardless of your situation, our solicitors at Woolley & Co can support you with making sure you get a fair settlement. For more information about your financial options during a divorce, contact our divorce solicitors today.

How are businesses treated during a divorce?

During a divorce, a business is treated differently to investments and cash because a company isn’t considered a liquid asset. It can be challenging to extract a cash value from a business and doing so has tax implications.

In a divorce, businesses are usually treated as shared assets, (even if one of the partners has never been involved in the company). Divorce law rules that all interests and assets can potentially be shared, including pensions, investments, savings, the property and businesses.

How do I protect my business during a divorce?

One way to protect your business during a divorce is to use a pre-nuptial or post-nuptial agreement which establishes what will happen to the company if the relationship breaks down. These agreements can be used to state that the company will not be included as part of the divorce proceedings or determine how the business should be divided.

Many people do not set up a pre-nuptial or post nuptial agreement before they get married and when they come to get divorced it is too late to do so.

The best way to protect yourself during a divorce is to get in touch with a divorce solicitor. They can advise you on your options and guide you towards the best way of protecting your business in the UK.

Is a limited company protected from divorce in the UK?

A limited company is not automatically protected from divorce. Even if one spouse owns the company and they owned it prior to the marriage, the limited company may still be considered as part of the divorce proceedings.

To secure a reasonable financial settlement and protect your financial resources, including your limited company, you’ll need the expertise and assistance of a divorce solicitor. At Woolley & Co we can guide you through protecting a business in divorce.

Is a limited company a marital asset?

Yes, a limited company is often considered a marital asset, the same as property, savings and pensions. Naturally, this is a concerning realisation for many business owners, particularly if you’re going through a high conflict divorce.

Reaching a financial settlement can be difficult, particularly when companies are involved. However, with the right legal support, you’ll have the best chance of protecting your assets, including your business.

How is a company split in a divorce?

When getting divorced, it may be possible to reach a financial settlement using negotiations or mediation. If this is the case, neither party will need to attend court.

There are many potential ways to reach a financial settlement where a business is involved, including:

Buying one another out: In situations where both spouses have an interest in the business, you may be able to reach a settlement if one person agrees to buy the other person out (i.e. purchase their share).

Offsetting options: If one individual has assets that are an equivalent or higher value than the company, that person could agree to let their ex-partner keep a larger share of those assets. In return, the business owner can retain the entirety of their company interests.

Spousal maintenance payments: If you own a business that generates a fair income, but has little capital value, you might agree to make ongoing maintenance pay outs to your ex- partner.

Sell the company: Though selling the business is an option, it is rare that you’ll be made to do so by the court, especially if the business is a major source of income for your family. Regardless, selling and dividing the company is an option, particularly in complex circumstances.

Our limited companies and divorce settlements solicitors in the UK are here for you

A limited company divorce settlement can give rise to many unique challenges, so it’s essential that you access the legal support that you need. Our team can offer expert advice on protecting your business in a divorce in the UK, ensuring that you have the information and legal support to achieve the outcome you deserve.

To take advantage of your free 30-minute consultation with our expert divorce lawyers, call 0800 321 3832, or complete our quick online form.

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