Partner Article

How to Protect Your Business from a Divorce

When it comes to running a business, there are not many more troublesome issues which can arise than the owner getting a divorce. Obviously, this is a difficult time in the life of the owner, but it also brings the business into inspection too. The owner will have to start thinking about how much the business is worth, and how much income it is producing for them – as when they are in court this will be put under scrutiny by the judge dealing with the case when deciding on a settlement for the owner and their partner. With that in mind, consider taking the following steps when protecting your business from a divorce.

What can I do Beforehand to Protect my Business Ahead of a Divorce?

Even though we often don’t like to think beforehand about things we can do to help ourselves in the event of a divorce, it can be very beneficial to take some of the correct steps early on in your marriage to protect your business from a divorce:

Get a prenuptial agreement between you and your partner – It can be very beneficial if you make an agreement with your partner for them not to make any claims against the business which will be damaging.

Keep your business and private assets separate – By making sure your personal assets such as your home and car are kept separate from your business, it will be massively helpful in ensuring that your business isn’t affected by the divorce.

Ensure you Get an External Accountant to Value Your Business

When getting your business valued, you should make sure that you get the valuation by and accountant who is not associated with your business. The reason for this is that when you use an accountant who is associated with your business to make the valuation, they would have been made aware about your personal affairs, and this may encourage them to undervalue the business in your favour. Additionally, when in court, this will be something which will bad in the eyes of the judge – will ultimately cause you extra problems.

The Steps to Consider Next

Without a doubt, one of the first things to consider if you are a business owner going through a divorce is to arrange to see a specialist will solicitors in order to update your succession planning. Leaving your business to your children in a will is often a good way to ensure the business is protected in the event of a divorce. Many courts will consider businesses that are part of your children’s inheritance to be off limits as they will be more valuable left whole.

This was posted in Bdaily's Members' News section by Rebecca Harper .