Managing divorce financial disclosure efficiently and effectively is the key to concluding an early and cost-effective financial settlement.
Divorce proceedings can be difficult to deal with. Separating couples often want to complete the process as quickly as possible. This is to allow them to move on with their daily life. However, finances play a major role in divorce proceedings.
There are often assets and finances of the marriage need to be properly disclosed, assessed and divided.
We see quite often that in the course of a marriage one party may have more assets than the other. Quite often separating couples may not know what assets need considering when managing their divorce. In this case parties may want to undertake a divorce financial disclosure divorce.
Divorce financial disclosure involves parties providing a full statement of account of all assets and income together with supporting documents. This is usually done by way of a Form E.
If the process is carefully managed then parties should be in a position to properly divide assets and reach a fair financial settlement.
The purpose of divorce financial disclosure to have parties on fair financial footing after a divorce.
Even where parties feel they are aware of all assets and income some take a safe course by way of opting for a divorce financial disclosure to be absolutely certain and also receive qualified legal advice on a fair financial settlement being achieved.
Whilst managing divorce, you may be entitled to certain assets from your separating partner. You may feel you are aware of all your partners financial assets. Quite often we encounter situations where one spouse has hidden assets from their spouse. They may also have involvement in other businesses which you may be unaware of. This means your partner may be more financially stable than you think.
The purpose of divorce financial disclosure is to provide a clear picture of what each partner owns. Financial disclosure divorce provides a guarantee that a settlement reach will be fair and based on fact. Financial disclosure ensures each partner discloses their finances and assets and are open and honest when doing so.
It is therefore extremely important you utilise financial disclosure to review the finances and asserts of your spouse. Once you have reached a formal agreement on financial settlement it may be difficult to go back. The divorce financial disclosure therefore provides clarity of the financial circumstances and allows certainty of fairness when managing divorce.
Divorce financial disclosure is a tool which if used adequately can assist you in ensuring you obtain a fair settlement. By carrying out financial disclosure you may be able to ensure you rightfully obtain what you are entitled to. This could help secure your and your family’s future.
Financial disclosure can be avoided if parties are able to reach an agreement on the division of assets and that agreement is based on open and honest disclosure. It can also be avoided if parties agree that neither of them wish to claim on each other on the basis of achieving a clean break.
Quite often when the separating couple are on good terms, they may want to avoid financial disclosure divorce. This can be avoided if both separating parties agree. This will often be the case where the couple’s finances and assets are not complicated. Partners may also want to avoid financial disclosure when managing their divorce to complete the process quickly to allow them to move on with their lives. Couples may also feel that by resolving finances in this way can save them a lot of money and time as well as moving on from their spouse.
Although separating couples can avoid financial disclosure to reach a settlement this carries risks. You want to ensure you receive a fair settlement. Afterall once you separate your future may depend on the settlement you obtain. Is therefore advisable for you to consider some form of disclosure to ensure you are fully aware of the finances. Your partner may be hiding some assets which you could lose out on. Our family lawyers recommend that you obtain divorce finance advice before reaching any settlement.
It is important to prepare early in advance for divorce financial disclosure. Both separating spouses should voluntarily begin financial disclosure at an early stage. The reason for this is to help facilitate enough time for being ready to have settlement discussions. If you can reach an early resolution you will save time, cost and inconvenience of attending court.
Early preparation can also assist with knowing what documents will be needed for disclosure. You can request and gather these documents early which can take some time.
Preparing early for financial disclosure allows you to receive proper advice upon any settlement. Before any settlement can be agreed it is important to ensure you are aware of what assets need dividing. Another benefit of preparing early for financial disclosure divorce is that it can save time. Ultimately if a matter proceeds to court, financial disclosure will still need to be made. By preparing early you do not have to worry about any deadlines as you will already be in a position to carry out the exchange of financial disclosure.
You will also be able to find out whether your spouse will be cooperative during financial disclosure. If voluntary exchange is requested early and your spouse does not co-operate this could ring alarm bells. There maybe underlying issues such as your spouse not being open and honest regarding their assets and may be concealing assets. As a result you may be able to make further enquiries and if needed consider freezing of assets to prevent your spouse from disposing of assets.
Managing your divorce can be difficult and you do not need further issues or difficulties. In some circumstances one partner may refuse divorce financial disclosure or may not be as co-operative as you require.
If your partner is refusing to deal with divorce financial disclosure then you could attempt to mediation. You may want to formally write to them inviting them to seeking a financial resolution through mediation. In the meantime it maybe helpful to secure legal advice from a family lawyer.
If despite all of the above your partner refuses divorce financial disclosure then you can make an application to the family court. The court can make a financial order requesting your partner to provide financial information.
Both spouses have a continuing duty to provide full and frank disclosure. However there may be instances where your spouse is not forthcoming with financial information. This could be either to frustrate the financial settlement process to afford time to dissipate assets.
Our family lawyers often see monies transferred into new partner accounts or standing orders being setup to pay partners a sum of monies for ‘expenses’.
If no disclosure is forthcoming or there is dishonest disclosure then an application to the family court should be considered.
Parties will need to ensure they comply with court requests to provide this information otherwise court sanctions may follow. An example of a court sanction could include a party being ordered to pay the other side’s legal costs or an adverse inference being drawn.
Courts also have the power to freeze any assets until conclusion of your matter where they feel your spouse is being dishonest and carry out further investigations.
Quite often a spouse may have acquired some assets through inheritance during the course of the marriage.
As a general rule, there is a difference between assets and property which have been acquired during the marriage to those inherited. Assets acquired during the marriage are assets which the couple have built up during the course of the marriage. These could include property, businesses or any other assets. Inherited assets on the other hand are assets which were not personally owned. These are assets which have been passed down to them following the death of parents or a relative.
Inherited money or assets are not automatically excluded from the assets to be divided.
Courts consider a number of factors when dealing with inherited assets such as the size of inheritance, when you received the inheritance, length of marriage, how it was dealt with during marriage and the financial needs of the parties.
Where inherited assets have been intermingled within the matrimonial assets your spouse may claim these should be treated as part of the matrimonial pot. This also applies if the inherited assets are used for the benefit of the family or transferred in joint names.
Inheritance can be treated as a matrimonial asset if both parties’ “needs” require the same to meet capital or income needs.
If however the inherited assets have been kept away from the matrimonial assets a partner may be able to request the inherited assets not be formed as part of the financial settlement.
The courts may decide to ring-fence the assets if it feels it is fair to keep the assets separate.
Future inheritances are not usually taken into account when dealing with the financial aspects of a divorce. It can be difficult, firstly, to gauge life expectancy and, to estimate the size of a potential benefit as testators cannot be compelled to disclose their intentions, which may change over time anyway. In exceptional circumstances the court may adjourn the lump sum element of an application until the inheritance is received.
One partner may be expecting a future bonus. This bonus may be payable once the divorce and financial settlement has been concluded.
There are conflicting views on whether or not future bonuses should form a part of the final settlement. The receiving party may argue that the bonus is to be received after a divorce settlement whereas the non-receiving party may argue the bonus would have been spent on then marriage.
Ultimately the courts will decide based on the parties income needs whether a future bonus needs dividing. If a split is ordered it will be on percentage terms as bonus payments may not be specific and change over time. It is important that you are open and honest in your financial disclosure and our family lawyers recommend including any future bonuses which you may be aware of or are entitled to receive.
Tailored advice needs to be obtained to suit your particular circumstances. We pride ourselves in providing quality tailored advice to help resolve your financial matters effectively and swiftly as possible. At Kabir Family Law our specialists will consider your case individually. A detailed review will be carried out on your personal circumstances to ensure you are provided with divorce finance advice to suit your needs. We will ensure the specialist dealing with your matter is the best fit for your matter.
Financial settlement is very important when managing your divorce. You need to ensure you receive adequate divorce finance advice. Once you have concluded your settlement it can be difficult to go back to the court unless extreme circumstances exist. You therefore need to ensure you receive advice from the right divorce lawyer.
At Kabir Family Law we will ensure you are provided with the right divorce law specialists for you and your case. We have many years of experience in dealing with financial settlement and divorce financial disclosure.
Our specialists will ensure they utilise their experience and skills to ensure you receive a fair settlement to secure your future. Contact us today on 0330 094 5880 to discuss your options or let us call you back.
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We are a team of family law and divorce experts with years of experience in dealing with all areas of family law matters.
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