Specialising in wealth preservation, we’ll provide the guidance and support you need to make informed decisions. Call us on 0330 123 9501 or complete the form below to speak with our team.
Our Family & Matrimonial team highlights the importance for business owners to seek early advice to minimise future problems should their marriage break down in the future.
Family & Matrimonial|08 April 2025
Insight
Divorce is never easy, and adding a business into the mix can create further complications.
There is the possibility of retaining joint ownership of businesses after a divorce has concluded, however, most couples find it difficult to remain business partners. The main objective when progressing with a divorce is often to cut all ties with your spouse and to obtain a ‘clean break’, allowing each of you to move forward independently.
Where it is not possible to retain joint ownership of any businesses or where only one spouse has a business interest, the Court usually aims to preserve the business as they are often a primary source of income.
Therefore, establishing the value of the business is crucial as this will need to be considered alongside other assets such as property, savings, and pensions when negotiating a financial settlement. It is also important to understand how the business is structured and what options are available to realise business interests.
Key considerations on dealing with business assets arising from a divorce include how business involvement will continue, the division of shares in a limited company, and any interests held by family members or third parties.
A common solution is a ‘buy-out,’ where one spouse will retain their business interest and control of the business but purchases the other’s share.
Businesses are not liquid assets, meaning that extracting cash can be complex and may have significant tax implications. If immediate funds are not available to buy out your spouse’s interest, payments can be made over time, or it may be appropriate for your spouse to receive a larger share of other assets and/or maintenance.
Whilst a formal business valuation is not always necessary, they can be useful to ensure the correct sums are paid, and you should take legal advice to consider the appropriate options in your circumstances. Your solicitor can advise on whether an expert valuer should be instructed. Business liquidity, tax implications, and realistic timescales must also be carefully considered.
It may be difficult to sell business shares, particularly, if there are several shareholders. If the Court orders a transfer of shares to your spouse, it may assist for you and your spouse to enter into a shareholder’s agreement to limit post-divorce disputes.
If your spouse is an employee in your business, terminating their employment could result in legal claims. You should carefully assess your options and take legal advice before making any rash decisions.
Nuptial agreements, such as a pre-nuptial agreement entered into prior to the marriage or post-nuptial agreements entered into after the marriage, can help to protect business interest and reduce disputes in the event of a separation.
These agreements can be particularly useful if a party owns a business prior to the marriage or if children have an interest in the business.
Nuptial agreements are not legally binding however, the Courts are likely to uphold an agreement if it is deemed fair and was freely entered into and so expert legal advice is essential.
There are many ways in which disputes can be addressed, though in the first instance, you should seek independent legal advice.
Alternative dispute resolution methods, such as mediation or collaborative law, may be worth exploring as an alternative to Court Proceedings.
If you’re in need of advice regarding divorce and separation or would like information in respect of nuptial agreements, shareholder agreements, or employment claims, our experienced lawyers can help.
Related Services
Need urgent help after PM Law Group’s collapse? Flint Bishop can step in to protect your legal matters and client funds.
Read More
A useful overview for separating couples who are considering a divorce.
Read More
Our divorce solicitors examine the post-holiday increase in divorce enquiries and the key reasons couples choose the New Year as a time for change.
Read More
We support Good Divorce Week 2025 by promoting constructive, compassionate approaches to separation and dispute resolution.
Read More
Government to repeal parental involvement presumption, prioritising child safety and risk in family court decisions.
Read More
Learn when parental consent is needed to change a child’s name and how Deeds or court orders can make it official.
Read More
Understand Clean Break Orders in divorce: what they are, when they apply, and how they protect your financial future.
Read More
Alienating behaviours can present themselves in a number of ways with varying impact on the children concerned.
Read More
For divorced or separated parents, taking children away on holiday can sometimes give rise to serious conflict.
Read More
How parents can safely support adult children financially with clear agreements to avoid disputes and protect family relationships.
Read More
What should happen to the family pet(s) is becoming an increasingly common issue for separating and divorcing couples.
Read More
Separated parents who wish to see their children at Christmas will need to come to an agreement with each other. But what if they…
Read More