Can I Sell my Business Before Divorce
September 2022
When you decide to separate or divorce it can feel as if everything is in suspended animation whilst you wait for your family solicitor to sort out your divorce and the financial settlement.
No one wants to be left in limbo whilst divorce proceedings are underway so in this article we answer your question on whether you can sell your business before you divorce.
Our specialist family law solicitors can help if you are the owner of a business or if you are married to an entrepreneur or a self-employed person. Our team has substantial experience in resolving complex divorce settlements, involving family businesses and business proceeds of sale.
Initial Discussion
This article provides general information and does not constitute legal advice on any individual circumstances.
For an initial discussion and a no-obligation quote, get in touch with us today by simply calling us on 01234 343134 or email us at enquiries@fullersfamilylaw.com and a member of our team will get back to you.
Selling a Business Before Your Divorce
You can sell your business before you get divorced but there are a couple of things to consider before doing so. For example:
- Sometimes people make quick decisions when they are separating that they later regret. You may find that you would have preferred to keep the business as the driver to sell was down to your marital problems and once divorced you still want the challenge of running your own business.
- If your husband or wife finds out about your planned sale of the business, they may think that you are selling up so you can avoid having to pay them as much in a divorce financial settlement. They could start divorce proceedings against you and apply for an injunction order to try to stop the sale.
- The timing of a business sale can have tax implications so it is best to take specialist advice from an accountant about the timing of the sale.
- If your husband or wife is an employee of the business they could have spousal maintenance claims against you if they lose their job as a result of the sale.
Things to Consider Before Selling a Business Before you Divorce
When you are contemplating selling a business before or during divorce proceedings it is best to get specialist legal advice from corporate lawyers and from family solicitors, as well as accountancy advice before you sell a business. It is sensible to consider various matters, such as:
- If you sell the business without discussing your plans to do so with your husband or wife, will they be suspicious about the sale and want to try to stop it? Would a discussion with your spouse about the reasons behind your decision to sell up help them understand the rationale for the sale?
- Are you selling the business to a friend or family member at an undervalued rate? If so, your spouse could either try to stop the sale by applying for an injunction order or set the sale aside or ask the court to award them a greater share of the non-business assets.
- If you are getting divorced and having to share your assets so you can both create two homes, is now the right time to sell the business?
- If you are keen to sell up make sure that the business is valued properly and independently so you can show that the sale was ‘above aboard’. That may mean asking an independent accountant to assess what the business is worth so you can be sure you are getting the most for it.
- If you are keen to sell your business but your spouse fears that you are doing so in order that you can keep all the business sale proceeds, you could agree to keep all or a proportion of the business sale proceeds in a joint bank account that neither of you can access without the other’s agreement until the court has decided how all your assets, including the pensions, family home and any investments should be divided
Selling a business is always complicated as you may be selling all the business or keeping some assets or agreeing to work as a consultant in the business for a specified period after the sale.
We can talk you through how an early sale of a business could work with an eventual divorce financial settlement, helping you to achieve a family law resolution so you can move on with your life.
How Can Fullers Help?
We understand that finding a solicitor that you feel understands your own specific situation can be a daunting task. So you can book a free callback with us here.
We have also created a series of fixed-price consultation meetings with a full ‘no questions asked’ money-back guarantee promise.
For an initial discussion and a no-obligation quote, get in touch with us today by simply calling us on 01234 343134 or email us at enquiries@fullersfamilylaw.com and a member of our team will get back to you.
