In family law, the division of property will take into account all the assets and liabilities of the involved parties. These combined elements are known as the matrimonial asset pool. If you have a business or are invested in a company, you should recognise that it will be considered during divorce and the division of property. In simple terms, the commercial setup will be assigned a monetary value, and it will become part of the pool. If you do not take measures to protect your business interests, you might compromise your financial future after the separation. Here are some simple guidelines to help you safeguard your company.
Create a Financial Agreement
You should think about signing a contract with your spouse, outlining the desired division of financial assets in case of a separation or divorce. These deals are commonly known as prenuptial agreements. In typical situations, these contracts are prepared and signed before marriage. However, you can enter into this type of deal at any time, including during and after the marriage. The goal of the contract is to agree on the most suitable ways to divide your assets and liabilities. When negotiating the agreement, you can protect your business from being torn apart. You should make sure that the terms are legally binding to secure your interests completely.
Separate Your Business and Personal Accounts
You should keep your personal or family financial matters separate from your business interests. In simple terms, you should not combine your family assets, lines of credit and general bank arrangements with your business finances. The blurred line will make your business more vulnerable during a divorce. The lack of clear distinction could be used to argue that family property was placed into the operation. Consequently, most of the assets in the company will become subject to scrutiny and division during the proceedings. You should remember that most businesses begin with family finances. Therefore, you should find time to make a definitive break.
Provide Accurate Financial Information
If your spouse has become estranged or you have separated, you should continue to provide clear details on the financial situation. This practice seems counterintuitive, but it will protect you and your business when the divorce proceedings begin. In general, the courts consider cases in which spouses attempt to hide assets with sternness. Therefore, failure to be transparent could cause the case to be ruled in the other party's favour.
You should consult with family lawyers for professional assistance before taking legal action to protect your business.