Divorce when you run a family business

If you own, or have an interest in, a business and are thinking about getting divorced or dissolving your civil partnership, you need to think carefully about the impact this may have on your livelihood.

DivorceSlide

Robert Bellhouse, family law expert at Ware & Kay in York & Wetherby, outlines the key considerations when a family business is involved in divorce or separation.

Consider whether your business is likely to be vulnerable

When deciding how the family's assets should be split, the court will consider a number of things, including where your assets came from, the contribution you and your former partner made to them and how they have contributed to family life.

Company assets are not immune

Depending on the circumstances, it is possible for a court to treat assets owned by a company you own or control as though they belong to you. Known as 'piercing the corporate veil', this is not something the court will do lightly but it is a possibility.

Protect the business

Very often the income produced by a business will be the main source of income for a family. Because of this the court will, wherever possible, try to avoid ordering a sale of the business unless it is essential to ensure a fair outcome.

Avoid court if you can

Using mediation or collaborative law, with the help of your solicitor and accountant, and possibly other professionals, can be a better way to reach an agreement without the need to go to court.

Protect yourself in the future

If you decide to get married again or enter a civil partnership with someone new consider a pre-nuptial or post-nuptial agreement to protect your business.

Published: November 2017

Contact us

If you need advice about separating business assets on divorce or separation, or if there is any other family law matter we can help you with, please contact Robert Bellhouse on 01904 716000 or 01937 583210 or email robert.bellhouse@warekay.co.uk.