Okay so we’ve had the example of the waitress and the millionaire. Let me talk you through this example, which is perhaps slightly more like the OP.
Let’s imagine that Aquea is a doctor and her fiancé Dave owns a small haulage company. The OP has already said that he employs 35 people, but he has large overheads and the margins are small.
Aquea and Dave agree a pre nup which excludes his business from the assets, then they marry.
For the first few years, his business doesn’t make very much profit at all. Yes, he has lots of money coming in, but he has even more going out to pay the wages of 35 staff, fuel, insurance , running the depot and servicing the huge bank loan he took out to buy the trucks.
So he says he can only take a wage of £20,000 / year . Every January and July there’s a cash flow crisis so he has no income at all . He even takes out a few personal credit cards, so he can use them to pay the staff wages if necessary. Of course these repayments ( as personal debt ) get added onto the family bills each month.
Aquea, however, is earning £40,000/ year as a trainee surgeon, so she pays 2/3 of all their bills , including the mortgage on their house , which they own 50:50.
Dave feels really bad that he can’t pay his share, but promises that it will all be different soon, when some of the bank loans are paid off and the company is profitable.
Then the first baby comes along and although Dave was very excited to be a dad, it turns out that his business is super busy and he can’t take any time off on paternity leave. As he frequently reminds her, he doesn’t get any paid leave like her so it makes more sense for her to take time off instead.
Fortunately Aquea had built up some savings, which of course they need to pay the bills for that year, as she earns 2/3 of their income and they can hardly survive on Dave’s wages of £20,000.
It’s a shame that Dave‘s company is still not making much of a profit, but then he’s ploughing every spare penny back into paying off the large company bank loans.
After maternity leave, Aquea goes back to work full time , as they need her wages and her savings are running out. Money is tight as they have a mortgage and FT nursery for a baby is expensive.
Very quickly, they discover that neither of their jobs fit around nursery hours so they have to hire a nanny. This becomes another source of stress as Dave hates having someone else around the house and it causes a lot of problems in their marriage. Eventually, Aquea decides to take a part time job in general practice for more regular hours, with no on call or weekend work.
She is bitterly disappointed to give up her post in surgery, but she tells herself she’s doing it for her marriage and her child.
Dave is still working lots of evenings and weekends at his haulage business, he’s hired more staff and making some profit. He brings his dad, his brother and his finance director Debbie into the business - they all invest capital in return for shares, which reduces the company debt. The share structure of the company is changed to reflect this, but of course Aquea doesn’t know as she has no involvement.
Another baby comes along and the last of Aquea’s savings are spent funding another maternity leave . She feels more and more resentful as she is paying 2/3 of the bills ( plus all the little extras for the kids that Dave would complain about) and doing all the childcare and 95% of the housework. She never sees. Dave as he’s always working or at the gym.
Everyone tells her she should expect to do everything as Dave works more than FT and she is only PT and besides, she is so lucky to be married to a rich business man who allows her to only work part time. Dave sometimes jokes about how he married a gold digger and everyone laughs.
When the children are both in school, sadly their marriage breaks up. It turns out that Dave is having an affair with Debbie, his finance director, who is pregnant with his baby . All these evenings and weekends he was “ working late“ was time he was with her. The money that he was borrowing on credit cards was probably going to Debbie - but Aquea can’t prove that .
It also turns out that the business makes a profit of £500,000 / year and has been doing so for years.
Aquea never thought to download the company acounts, as she was too busy working 4 days a week in a demanding job, running the house and brining up two small children single handedly. Besides, she trusted her husband .
Even if she had done so, Dave and his accountant has set up a complicated structure of several linked companies , with a HQ in the Isle of Man.
So in the divorce, the assets of the marriage are
⁃ their home , which Aqueq has paid 2/3 of, but she will get half
⁃ Her NHS persion which she has paid all of but she will get half
⁃ Her car, which she paid all of but she will get half
⁃ Her savings of £40,000 which all go on legal fees for the divorce. But she will still have to pay Dave half of them.
She won’t get the business because of the pre nup. Her solicitor thought she might have a good case to fight this, as their circumstances are very different from when it was signed.
But when they investigate, they find out that since the share structure was changed, Dave’s shares now only have a right to income and not capital. All the capital belongs to the shares owned by Debbie and Dave’s parents , which means that he has no assets in his own name for Aquea to come after.
So even if Aquea fights and wins some of Dave’s shares, they will be worthless to her as they only have a right to income as decided by the Board ( which is Dave, Debbie and his parents ).
Dave claims to have no pension and he doesn’t even have any money in his bank acounts , as he uses the company credit card for everything . Turns out his car is also a company car.
Dave and Aquea have to sell the family home and after the mortgage is paid off, Dave will get most of it as he gets
50% of the house
50% of the CETV for his wife’s NHS pension accrued during the marriage 50% of her car
50% of her savings (which are already spent )
Dave even threatens to clain spousal maintenance from her , as she is now earning £60,000 as a PT GP and he is only taking a salary of £24,000 from his company.
As soon as Aqua moves out, she puts in a claim to the CMS for child support for their two children. Dave immediately drops his salary to £9,000 / year, so he only has to pay £7 week child support.
Debbie continues to take a salary and dividends of £ 250,000 / year from the company.
Dave tells all his family that Aquea took him to the cleaners in the divorce - they all feel sorry for him.
And that , dear readers, is how Dave walks away with a company worth million, an annual household income of quarter of a million and a huge pension and savings in an offshore account. He pays no child maintenance and never sees his kids ( well he and Debbie have a new baby to keep them busy ).
Aquea walks away with nothing except the kids, her car and her pension. She is now mid 40s and has to take out a big mortgage to buy a 3 bed flat , as she has only a small deposit.