Separation or divorce in Australia can be a challenging time, both personally and professionally. When you own a small business, the stakes can feel even higher.
Business worries worsen an already stressful separation. Furthermore, at Martens Legal, we understand the complexities that small business owners face during a separation.
This guide aims to provide clarity on some of the key issues you may encounter.
-
Business Valuation for Divorce in Australia
One of the most critical aspects of protecting your business during a separation is obtaining an accurate and fair valuation. The value of your business will significantly impact any settlement negotiations or court orders regarding its division.
Therefore, it’s essential to engage a qualified business valuator with experience in assessing businesses similar to yours.
-
Division of Assets during Divorce in Australia
How your business assets are divided will depend on various factors, including whether you own the business solely or jointly with your former partner, any binding financial agreements that exist, and the applicable family law legislation in your jurisdiction.
Specifically, it’s important to seek legal advice to understand your rights and obligations regarding the division of business assets.
-
Ongoing Ownership Arrangements
If you co-owned the business, decide on future ownership and management. This could involve one party buying out the other’s share, continuing to co-own and operate the business together, or selling the business and dividing the proceeds.
Each option has pros and cons; choose based on your situation. Seek legal and financial advice; we’ll partner with your advisors for informed decisions.
-
Protecting Your Business Interests
Taking proactive steps to protect your business interests during a separation is crucial. Some strategies you may consider include:
- Seek legal and financial advice early on to protect your interests.
- Reviewing and updating your business agreements: Ensure your partnership agreement, shareholder agreement, or other relevant documents are up-to-date and reflect your current wishes regarding ownership and management in the event of a separation.
- Keeping clear financial records: Maintaining accurate and organised financial records will be essential for business valuation and asset division purposes.
Conclusion
Navigating a separation as a small business owner can be daunting, but with the right guidance and preparation, you can safeguard your business and achieve a fair outcome.
At Martens Legal, we have extensive experience assisting clients with the legal complexities of separation and divorce in Australia, including protecting their business interests.
If you’re facing a separation and have concerns about your small business, contact Martens Legal today for expert advice and support.
