How to Protect Your Business During a Divorce
Divorces aren’t nice, which is an understatement. They can be extremely draining both emotionally and physically. If the divorce can be finalised amicably then great, although we all know this isn’t always the case.
While divorce has been in the news recently, people usually think of the house and finances first. But, one thing many people don’t think about straight away is their business. If there’s a business involved in the divorce, there are a few things you should get in order before proceeding, which we’ve highlighted below for you.
Although you may have hired a business lawyer, you’ll need to ensure you’ve good divorce lawyers too. When looking for one you should ensure that you find one with a good track record so you can have confidence in them. This will also mean they can take account of lots of different problems, meaning you can be confident they’ll be able to help you through the process.
You’ll need to get everything from your bank statements and financial documents to your tax documents together. If you don’t already have an accountant, then you’ll have to get one to go over your books. If you can do this amicably with your spouse then even better.
If you don’t already have an accountant, then you’ll have to get one to go over your books.
If you can do this easily, then perfect. But, just because you’re married, it doesn’t mean everything should be split 50/50. Things you’ll need to address when it comes to the business include; did you start it before meeting, do they work there, and are you the sole owner. These will all help in determining what happens with the business.
Make sure that all household and business finances are separated. If they aren’t before the divorce, make sure they are before proceeding, because record keeping is much harder when accounts are all managed together.
Make sure that all household and business finances are separated.
This may sound extremely heartless and cold, but in the case of the business, if your spouse works there, you’ll need to fire them. This will allow you to phase them out of the business, which is better done sooner rather than later.
Every conversation had in regards to the business needs to be documented. Whether that’s written in an email, signed on paper or another way. This will give you proof of anything that’s mentioned or agreed upon. You don’t want to fall prey of someone going back on a verbal agreement, which won’t stand up during the divorce without any evidence that it ever happened.
You don’t want to fall prey of someone going back on a verbal agreement, which won’t stand up during the divorce.
Finally, in order to protect yourself, you’ll need to open bank accounts in your name and your name only. Make sure everything is correct with your credit reports, and then change any details with your contacts to ensure anyone dealing with the business only deals with you moving forward, and not your spouse.