How will Divorce Impact My Business?

As a business owner facing divorce, you’re likely to be concerned about how the separation might affect the company you’ve worked so hard to build. 

Whether you’re running a small startup or an established medium-sized enterprise, understanding how divorce proceedings might impact your business is crucial for protecting your professional future.

In this article, we explain everything you need to know about what happens to your business during a divorce. 

Business Ownership and Divorce

The impact of divorce on your business largely depends on several key factors:

• Whether you owned the business before marriage
• If your spouse has been involved in the business
• How the business has grown during your marriage
• Whether the business is your main source of income
• The overall value of your marital assets

Sole Ownership vs Shared Business

If you’re the sole owner of your business, you might assume that it’s automatically protected from divorce proceedings. However, even if your spouse has never been involved in running the company, the business may still be considered a marital asset if it has grown in value during your marriage or if marital funds were used for business purposes.

For businesses shared between spouses, the situation often requires more careful handling. Both parties may have invested time, money and effort into building the company, making the division of business assets more complex.

Business Valuation

One of the first steps in divorce proceedings involving a business is obtaining an accurate valuation. This typically involves:

• Assessment of physical assets
• Evaluation of intellectual property
• Analysis of future earnings potential
• Review of business accounts

Protecting Your Business During Divorce

While each situation is unique, there are several steps you can take to help protect your business:

• Gather comprehensive business documentation
• Maintain clear financial records
• Consider buying out your spouse’s interest
• Explore offsetting business value against other assets
• Investigate restructuring options

The Importance of Specialist Legal Advice

Every divorce case involving a business is unique, which is why seeking specialist legal advice is crucial. At Goodwins Family Law Solicitors, we understand the complexities of business division during divorce. Our experienced team has helped numerous business owners navigate this challenging process since 1993.

Our team at Goodwins specialises in:

• Asset division involving complex asset structures

• Negotiating settlements
• Protecting business interests 
• Instructing experts on your behalf to obtain business valuations 

Taking the First Step

If you’re a business owner considering divorce or are already beginning the process, getting early legal advice is crucial. At Goodwins Family Law Solicitors, we offer initial fixed-fee consultations where we can discuss your specific situation and outline potential approaches to protecting your business interests.

We understand the sensitivity and complexity of these situations and pride ourselves on providing practical, professional advice tailored to your circumstances. Video consultations are available for your convenience.

Contact Us

To arrange a consultation and discuss how we can help protect your business during divorce proceedings, contact our experienced team today.

Remember, the earlier you seek professional advice, the better position you will be in to protect your business interests throughout the divorce process.