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Talk to me about protecting my share of assets agains business failure

(13 Posts)
IamNotDarling Sat 28-Oct-17 23:52:26

Hi, my DH is joining a professional partnership. It’s not an LLP and he’ll share unlimited liability with the other partners.

Does anyone have any advice on steps I can take to protect my share of jointly held assets? We have a mortgaged home, held as tenants in common and hold limited savings jointly (main savings held
separately, roughly in equal amounts).

TIA

Ta1kinPeece Sun 29-Oct-17 15:26:08

Why on earth is it not an LLP ?

How much risk do you think his activities actually place you under ?

IamNotDarling Sun 29-Oct-17 16:43:03

It’s long established and never converted. They have professional indemnity insurance.

Not massively worried but don’t want to be naive about placing the house at risk.

Ta1kinPeece Sun 29-Oct-17 16:47:10

Depends on the industry
and if they have good PII its a much lower risk.

Law : ask to see what the firm advise
Accountancy : get them to switch for tax reasons grin
Architecture/ construction : v v v low risk

HoneyWheeler Sun 29-Oct-17 16:56:18

Your share is already protected unless you’re involved in the business. His is not though. So for example, if the business went under, you might have to seek your house, you’d get your 50% and then his would have to cover any liabilities.

HoneyWheeler Sun 29-Oct-17 16:57:54

But if you want to protect your house etc he should convert to an LLP or a limited company

Ta1kinPeece Sun 29-Oct-17 16:59:40

While what honey says is correct, having been involved in a case where the wife had to "realise" her half, the husband was left homeless as his half was not enough to buy another house ....

Karak Sun 29-Oct-17 18:46:25

There's at least one major law firm that's still a partnership. If the OP's DH is taking equity there there's no way he'd be able to argue it get converted. Seems to be a point of principle for then.

IamNotDarling Sun 29-Oct-17 18:47:10

Thanks. Conversion isn’t an option; he can’t dictate to the other 9 partners.

Is it worth severing the tenancy?

Ta1kinPeece Sun 29-Oct-17 18:54:14

Nope.
Unless you have the slightest reason to believe that it will hit the fan.
The costs you will incur will be money down the drain for a risk that has a <10% chance of crystallising.

Best thing to do is to talk to your DH and get a wodge of your savings put into your sole name
if the house is mortgaged its worth zilch
so its investments that are worth protecting

IamNotDarling Sun 29-Oct-17 20:15:35

We have about £150k equity in the house. I thought severing tenancy was pretty straightforward?

HouseworkIsAPain Sun 29-Oct-17 21:27:02

I thought you could change to the other type of tenancy with just a form? Wasn’t aware that it would have tax liabilities if you were going to split 50/50

Etymology23 Tue 31-Oct-17 05:47:40

All transfers within a married couple are nil gain nil loss for capital gains, so there shouldn't be any tax consequences if you were to transfer anything into your name.

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