Divorce Complications For Owners Of Small-Medium Sized Enterprises (SME’s)

06 May 2016

The Office for National Statistics has identified a rise in divorce rates for those aged 40 to 44 and statistics suggest that most SME owners are aged 35 to 54.

You may not be aware that, in law, an interest in a business is a matrimonial asset so a divorcing spouse has a legal right to fight for their share. Also if you have an interest in a multi-shareholder SME the value of your interest in the company may be affected if one of the other shareholders divorces.

Case law has shown that the results can be severe. Along with the loss of your business share there are increased legal and accountancy fees in relation to share valuations and forensic accountants to represent the parties defending their interests.


Pre or post nuptial agreements are the key to clarity and honesty for all parties involved, directly or in-directly.

Being married without having a pre-nuptial agreement in place of course does not spell instant disaster. However, it may be prudent to suggest you and your business partners agree the terms of a post-nuptial agreement.

This can set out whether the business will form part of the matrimonial asset pot, how finance will be raised to cover the amount claimed and the timeframe of how and when that will be paid.

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