This is a Premium feature
To use this feature subscribe to Mumsnet Premium - get first access to new features see fewer ads, and support Mumsnet.Start using Mumsnet Premium
Anyone else's ex own a limited company?(17 Posts)
Hi everyone. Need some help on this one as it is massively stressing me out and I really can't afford to pay my solicitor for more advice.
So my ex and I are finally about to start financial mediation (5 months after I submitted all my disclosure forms).
Anyway he told me on Friday that he is putting his salary down as 38k a year and will therefore not be paying as much maintenance as he currently does... To put in context, he actually earns £500 a day and has done for the past 4 years. This gets paid into his ltd company and he then pays himself in dividends...
He owns a limited company and is the only employee. I am a share holder. For the past 10 months, since he moved out, he has been paying me maintenance and also his half of the mortgage through his business. This means I have to pay tax and student loan repayments on this money and it also gives me an artificially inflated income. I've told him this had to stop and he's gotten very nagry, hence the declaring a much lower salary.
My question is what can I do? If he does only pay himself 38k going forwards and puts a lot of expenses through the business and leaves the rest there, his self-assessment will show he earns 38k won't it, not his actual 6 figure salary.
It just seems so unfair that he is going to be living this life of absolute luxury whilst I meanwhile will be raising our children and struggling to make ends meet.
I can't really offer any advice, but what I can say is that any man that does this is a bastard, and I say that as a man.
Why cant these 'fathers' see that all they are doing is making their children's lives harder by their actions, just in spite of their ex-wife, who assuming at one point they also loved.
It really boils my blood.
Sorry, and hope that he wakes up and does the right thing for his children, and of course you.
Thanks @MrBrightside1980. Good to know there are some decent human beings out there still!! He's doing it for control. He's angry I left him and won't take him back (he had 3 affairs but apparently I should forgive him as he says he won't do it again!). Wish he'd just stop and think about what he's really doing and that's hurting his kids, directly and indirectly. Me struggling for money isn't good for them and be me stressing about all this isn't good for them either.
Will you still own part of the business? If so won't you get the inflated dividends too?
Well we have A/B shares so we don't get equal dividends. I also have zero involvement in the business and no access to anything. He chooses what to pay me in dividends. The point is if he pays me dividends to cover the mortgage and child maintenance then I have to pay tax and student loan on that and probably will lose my.child benefit too.
He can't pay you child maintenance in dividends...
Sound like a complete nightmare and very specialist tbh.
Go for a much larger share of the assets as part of the settlement in return for resigning as a director? Do you have this in writing from him.
Unfortunately you need a solicitor experienced in this area to advise you and it's too valuable to not take appropriate legal advice.
You need to get an accountant to give advice on this. Some divorce law firms have in house accounts that specialise in exactly this type of attempt to fleece a spouse using a limited company. Look around and choose one that suits your situation.
Yeah agreed it is a complete nightmare tbh. I was hoping to avoid high legal costs tbh and just to get this resolved in mediation but he's started being a complete arse about it all. Unfortunately we have few shared assets. Only had our house 3 years so very little equity... I'm screwed aren't I
You own those shares as a Director...
Ah okay I see what you mean. No idea how he'd pay me them tbh. He spends money like noone else I know so no doubt the company account is very low!!
I’m not brilliant on this kind of thing, but my ex also had a limited company when we separated.
If I were you, I’d go and see an accountant. Take everything you have about the company - info from Companies House, accounts, any disclosure from your ex, etc. And see what they say, see where you stand. IME solicitors don’t tend to know much about this kind of thing and will point you to an accountant anyway.
You say he’s paying personal bills and maintenance through the company? Do you know if he’s doing that through salary/bonus to himself, or through dividends? Just asking because if it’s through dividends and you’re a shareholder too, then you should be receiving dividends too. Any dividends paid out need to be paid to both of you, according to the proportion of shares you each own. From what I recall, dividends must be paid to you, into an account in your name, and you must receive a counterfoil or similar detailing this.
Also may be worth remembering that if he’s supposed to pay you money/maintenance, he can’t do that through paying you dividends. It’s the company that’s paying you dividends, not him. And maintenance would need to be paid by him.
Hi OP I have a ltd co and pay myself dividends.
Not sure what stage you're at with court, but if you think he's lying about his income, you can ask him through lawyers to produce his invoices to show what's coming in.
But be aware the economic crisis is hitting pretty much everyone right now. He may not be lying.
You own those shares as a Director...
You can be a shareholder and not be a director.
My ex had a very creative accountant. 6 figure salary but paid £5 a week as he was only earning £99 a week. I have no idea how he did it but it's definitely possible. Git.
@Alys20 he definitely hadn't lost work as he is hired by a company as a contractor. He don't works for one firm and still goes to work every day...
Sorry @Worakls, not clear from your post whether he does or doesn't work for one firm.. Anyway if you are sure nothing's changed in his income level and you know for a fact he's still working same place same hours etc you can present all this to the court and he can explain his financial wizardry and deceit to the judge... He can't just do what he likes but probably wants to scare you.
Thanks @Alys20. Sorry I realised my typo. Yeah he only works for one firm, has done for 18 months now and his contract hasn't changed. I've emailed my solicitor too in preparation for Monday so hoping to get reassurance.
Please login first.