“I’m Running A Business While Going Through A Divorce - Will My Business Need To Be Valued?"

You may already have explored and established that in a large number of cases business assets are often included in the matrimonial pot when looking at division of overall assets.

However, the question of whether or not a business will need to be valued is more nuanced. If you are a sole trader, it may well be that there is no saleable value to your business, aside from any equipment that you have, in which case your income will likely be of more value in the case. 

Where a business is a partnership – with or without an agreement – often the first place to start would be to establish who are the partners, their involvement, and the possible value of their individual shares. It may be, if the business extends beyond a husband/wife partnership, that a valuation is necessary.

Where there is a limited business, with other shareholders, directors’ loans, and intermingling of personal and business monies, then a valuation is more likely to be required. Factors like the company’s assets, debts, any contracts, profitability, as well as number of shareholders will need to be carefully considered, and the divorcing party’s specific share will need to have a value attached to it. If there are physical, tangible assets like property, plant and machinery or even intellectual property such as patents/trademarks, then it becomes more complex still.

If your business falls into one of these more complex categories, then a valuation is likely to be necessary, and it is worth being aware that they can be quite expensive.

If you think you may need help understanding whether your business may need to be valued, or actually instructing an expert to value your business as part of Financial Proceedings on divorce, then we would be happy to help. Just call us on 01926 491181 or email: family@moore-tibbits.co.uk.