Practical advice needed, getting divorced, he owns his own business.

[Iceland22]

I’m heartbroken but he has made up his mind so I need to be practical.

Married 10 years. He started his business about five years ago.
The building that he operates his business from is owned by him (pension fund) and rented back to the business.
He earns about 3.5k per month which 3k is dividend, £500 salary.
I don’t know where to start.

We have two girls, in the past five years I’ve only worked full time for 18 months after having one child after another (maternity leave and redundancy). Girls are 6 and 4. I can’t face the thought of 50/50 access, I want them with me.

He decided tonight. He’s not going to change his mind. I need to be practical. What do I do now?

I don’t have access to the accounts so how will I get this info? I can only get the year end accounts online.
I’m screwed aren’t I?

The fact that he only declares a £500 salary and gets £3k in divdends is raising a massive flag for me. You need to get proof of this. I bet you a penny to a pound he is doing the same thing as my cousin and only declaring earnings as £500 and the rest of a legal but morally dubious tax fiddle by his accountant. This means that the CSA will only asses his £500 and he will very very likely be entitled to tax credits or UC credit too to top up his earnings. This is very common in small businesses where people are subcontracted out to drive other peoples vehicles etc or as labour/ "specialists".

You need to make a list of all the maternity leave/career breaks/sacrifices you have made to enable you to raise his children while he can carry on progressing his career ( with the expectation that your sacrifices would benefit you both down the line).

The fact that you have lists of your previous child care commitments is good, it shows he has never bothered with the school run etc so is more likely to get weekend access and will still have to pay a pittance from his £500 a month wages.

The fact that he has become so nasty and cold over night strongly suggests that there could be another woman and he is trying to ring fence as much as possible so they can start afresh. You need to be prepared for this to turn nasty and you need to fight for everything you can get out of him.

Not screwed, for all we know he will be completely reasonable and transparent about his finances. We're just giving you suggestions for worst case scenario.

Try where possible to get as full a picture as possible of his and your financial situation. This means that if inconsistencies come up during the divorce process you will spot and be able to counter them. It also gives you the opportunity to make reasonable requests.

Op I am so sorry that you are in so much heartache and that you are having to go through this bereavement.

I have nothing else to add to the advise the others have shared, other than that he is no longer your friend, he from this point is your enemy. Do not agree to anything, do not engage with him unless you go through things with your solicitor first.

Keep focused and find your anger.

Thank you - I need this advice. His bank statements will show his dividend payments and savings but I don’t have access to this.

As an guide you will be entitled to half of the value of his shares in the company (see companies house). And half the value of the properties (home and business) less any mortgage plus half his pension pot and obviously he gets half of yours too.

The shates van be valued by an accountant. Chrck the yrar end accounts. Look at operating profit (add back exceptional items, depreciation amortisation), is this figure (earnings befpre interest tax depreciation and amortisation) going up year after year? If yes take the most recent profit figure and multiply it by 4 or 5 or 6. If its a high growth techy business maybe more. Deduct any loans the company owes and add in the cash allowing some left over to cover current liabilities (less current assets). That shoukd give you an idea of the value of the shares. If you can get forecasts in disclosure you should ask for outturn for the next financial year (but beware this usually shows worse case scenario as they make things look worse for the divorce).

Look at net assets (also called shateholders funds) on the balance sheet. This gives you the minimum value of the company. If he has any goodwill built up (made a name for himself, got recurring customers, any software technology or processes developed) that adds to goodwill. I would usually value a profitable business that doesnt own its own property as a multiple of earnings.

Its more complicated than that but thats a start for you.

Bad news is you cant get capital value for profits he may make in the future. Plus if he cant pay you (due to lack of liquidity) he wouldnt be expected to sell up to pay you. They might look at whether he can get a loan.

Getting a dividend instead of salary is normal owner manager action. Its lower tax. Not morally dubious. Youd still be better trying to get a settlement not going via csa because of this.

OP, it's great to get all your information lined up so far as you can, but please don't just assume that your DH will be difficult. My ex was cold & hard too emotionally, but when we discussed finances he was very fair. You are in very early days at the moment, and much will depend on how you communicate with each other now. If you channel solely your anger you are likely to end up getting a similar response back from him. I would advise you channel your dignity & strength instead.

Share not shate!!

Hi OP,

I've been in the same boat for nearly two years now. My STBXH delayed financial disclosure for a full year - it was always 'nearly done' or 'just waiting on the accountant' etc, in the meantime his business is conveniently suddenly doing poorly (despite him blowing c.£50k last year on holidays and designer clothes, not the behaviour of someone with a struggling business). He's now taken a pay cut on the advice of the accountant - conveniently minimising CM payment.

If he's going to provide disclosure get it done as quickly as possible. Your sol can request dividend statements and tax return as part of disclosure which will evidence his true salary. I could also get copy of profit and loss account as I was a shareholder, try getting a copy as it will show your sol how the business is really performing. Check pension payments to other accounts, credit cards etc, think of other assets. My ex has frittered money away and hidden it well out of reach, I can only imagine what he has stashed away but I'm cutting my losses for it to be over for the sake of my DC. Solicitors bills would eat up what it would cost to try and find the balance, and I had a good sol and forensic accountant. Copy as many docs as you can now as he will deceive. Yours sounds just like my ex - he is a different person, so don't trust him. Sorry you're in this boat, get all the crying done early on because you need to fight for you and your DC, you'll surprise yourself how strong you can be. Good luck.

Thank you everyone. He is extremely clever and I’m sure has thought this through before taking the leap and sought advice. He casually mentioned that the business isn’t doing as well as previous years only a few weeks ago hmmmmm
He said he is in ‘no rush’ which makes me think he’s getting his ducks in a row. He might not be. But I think I have to assume the worst.

You need to assume the worst, you really do. This person is not your friend.

I agree assume the worst - just the fact that he has separate savings account in his name only would suggest he thinks this is 'his' money and not joint money - I think the business through the pension may be a way of reducing pension split to you. What was the reason behind dodgy times 18 months ago?
Does he EVER help out with childcare house stuff or does he use Too busy as a way of avoiding - what about Xmas when he is off - does he muck in or is it HIS time to switch off. This will indicate how selfish he is.

You really need a very good solicitor - mine stalled with financial disclosure too - basically kitted a new home out in the delay lots of holidays etc played down the business with help from accountant - even forensic accountant couldn't get to bottom of it - I got nothing for business even though 50% shareholder - he ran up huge debts on credit cards to eat into equity and reduce what was available to share

Ask him for the information you need - if he is going to be fair he will give you this - if not you need to keep all your salary back and retain as much money as possible

Sorry to say again any chance of OW - my x tried to plan a split just saying he no longer loved me blah blah - tried to keep OW out of it - but her X found out and threatened X with telling me or he would. Business not doing so well sounds predictable too.

Sorry Op I fear you are going to have a fight -

I think your DH knew what he was doing with the pension and yes

I think that you are right in assuming the worse. He may be very clever but you have a whole host of people here who wish to help you.

Pop over to the legal forum here, Collaborate, amongst others, is a fab mner who give lots of help and advise to people that need it.

He’s suggested this morning that we sort it out ourselves and not use a solicitor.

OK then.
Tell him to put the proposal together for you to read through.
Then take it to a solicitor.

'He’s suggested this morning that we sort it out ourselves and not use a solicitor.'

Of course he did. Start researching solicitors now. Get over to the legal boards and ask for recommendations. And what hells said. He is preparing to screw you over.

No, no, no.

Please do not take him up on this. You need a solicitor. Definitely. Divorce will involve splitting your assets, dividing your interests, and will affect your financial future. Don't do that without expert advice, especially in a situation where there is a business to be considered.

Please go and get your ducks in a row. Get advice - financial advice. Emotional advice too if you would like it, and it would help you to stay strong and focussed. All worth the investment. Because this is your future you're talking about.

As hells said get his proposal - do not tell him what you are doing - you need to try and keep as much to your chest as possible - he is already 6 months ahead of you maybe more - I am still trying to pick up some pieces 6 months after final hearing due to being ripped off by solicitors who did not believe what I told them X would do - I lost the family home as a result - he manipulated the case all the way through - I believed my sols were capable they were not - they just wanted to get me to a final hearing ( more £££ for them) and ditched me 6 weeks before after I got too clued up & starting asking too many questions.

I now have complaints in left right & centre trying to claw back some of what I lost out.

His proposal will give you an indication of what you are dealing with

That’s a good idea, I’ll do that. He must think I’m insane.

OP, also channel thst strength. You don't need to tell him your plans or that you are seeing a solicitor. He doesn't need to know yet. Just make sure you are looking after your own interests.

When does the pain go away? I’m just lying in the bed crying. We had a normal conversation about the news today, I forgot about how bad things were. My head is fucked.
Can’t eat, shaking, crying.

It's awful.
And there is no time scale.
Try to keeping hydrated even if you can't eat solids.
Anything liquid.
Do try to keep busy.
Gym.
Friends.
Local groups.
Clear out cupboards
Clear out wardrobes.
Re-arrange a room.
Redecorate.
I feel for you I really do
After being with my ExH for 15 years it took a year to get back to me.
Give yourself time.

OP, what you're feeling is normal. Can you try to breathe slowly and calmly, with your eyes shut if that helps. Breathe in through your nose, out through your mouth. Just concentrate on breathing.

Do you journal at all? I found journaling really helped me to get my feelings out and to recognise them, & handle them.

I understand what you're going through & I'm sorry I can't tell you when it will feel better for you. It sounds as though you've had a 'normal' conversation today, and it's thrown you. Is that right? It must be confusing for you. Can you stay away from conversation with him?

Massive hug for you xx

Thank you both. I coped well over the weekend but have been physically shaking all day today. It’s like my body is shutting down.
One day at a time.
I’ve had some recommendations for solicitors so that’s my next step.

Thanks for replying, I feel so lonely x