Divorces can be straightforward when a couple has few to no assets. But with an increasing number of business owners in the UK, you may be worried that you are going to lose half of your business if you get divorced.
Today, there are more than 5.7 million private sector businesses in the UK, making business assets an increasingly common fixture in divorce proceedings. You likely have questions about business assets, income, shares, company value, directorships, tax and future control.
At VM Family Law, we advise business owners like you on how divorce affects your company, providing clear, practical guidance to protect your interests. After all, your business represents years of hard work, so contact us for a free consultation to safeguard your company.
Specialist legal support with divorces for business owners
Going through a divorce as a business owner raises complex legal and financial questions. The court must know what a business is worth, whether it counts as matrimonial property, and how it fits into the overall business asset split.
Although the median total asset value of divorcing couples is just £135,000, thousands still have significantly more. Disagreements over family-run businesses, assets shared with other shareholders and latent pre-marriage business value can make asset splits extremely complex.
That’s why expert legal advice is necessary to protect what you’ve built and assert your legal position. We work with accountants, tax and financial advisors, business experts, pension professionals and more to ensure you get the best advice tailored to your situation.
What happens to a business in a divorce?
Businesses are usually considered to be part of the overall asset picture when couples divorce. It doesn’t mean your business will be automatically sold, divided or transferred. The Family Court generally prefers to keep successful businesses operating, especially if they’re a key source of income.
However, the value of a business will still be taken into account when dividing matrimonial assets as a whole. Aspects a court may consider include:
· Company accounts
· Retained profits
· Dividends
· Director’s loans
· Goodwill
· Future earning potential
Will my business be split 50/50?
Contrary to popular belief, there’s no law requiring all assets to be split straight down the middle. The 50/50 principle is the yardstick for equality and a starting point, but courts can and do deviate from it, as established by cases such as Charman v Charman [2007].
Courts will consider both sides’ current and future financial needs. Additionally, as established in cases like Standish v Standish [2025], non-matrimonial property can be excluded, and the 50/50 split can be deviated from to meet each side’s needs.
Likewise, other factors might include:
· Standard of living
· Age
· Marriage length
· Contributions
· Dependent children
Is your business considered a marital asset in divorce?
A business will be classified as a matrimonial asset if it was started, developed or saw big increases in value during the marriage. Likewise, a business can still be considered matrimonial property even if it was started before the marriage if it provided income for the family or was mixed in with your finances.
In practice, this will mean businesses are usually considered marital assets. However, courts won’t treat every business in the same way.
For example, if you inherited or were gifted a business before you got married, there’s an argument that it should be treated differently from assets built up during the relationship; and this is where complex legal arguments tend to arise.
How to protect your business against divorce
Protecting your business against divorce starts with planning.
If you’re not yet married, the best way to protect your company is to enter into a prenuptial agreement. These agreements lay out how your business interests are to be treated in the event of divorce.
Even if you’re already married, you do have options available. A postnuptial agreement can provide clarity and reduce the risk of future disputes.
In either case, a key strategy is keeping personal and business finances separate as much as possible. If you’re already going through a divorce, your options are more limited. Attempting to restructure, sell or move business assets could open you up to accusations of trying to hide or reduce asset value and the Family Court will deal with such attempts accordingly.
Practical protection involves engaging with dedicated professionals, such as expert valuation agents, who can advise you and negotiate a settlement to help protect your company from disruption and harm.
What happens when a spouse works in the business?
Businesses, where your spouse is an active part of the company, make matters more complicated because if your spouse is a director, shareholder, or employee then they will also have additional rights under employment and company laws. How this is handled will differ in every divorce.
Approaches might include:
1. One party agrees to leave the business as part of a financial settlement, such as a direct payment or a greater share of another asset, like savings, property or pensions.
2. The spouse may remain involved, which can be practical if you stay on good terms with your ex-partner.
The Family Court will prioritise the financial needs of both sides, but they generally prefer to keep viable businesses afloat, especially if it’s providing income for one or both parties and dependent children.
Why choose VM Family Law when divorcing as a business owner
As you can see, the complexities of dealing with a business in a divorce setting are immense. You need a solicitor who understands both the legal issues and the practical importance of protecting what you’ve worked so hard to build.
VM Family Law is a leading family law firm recognised by The Legal 500, ensuring you reach a fair financial settlement whilst protecting you and your business from future claims.
If you’re a business owner going through a divorce and you’re concerned about the health and well-being of your company, we can help you understand your rights, protect your interests, and feel empowered to write the next chapter of your life with confidence. To learn more, schedule your free consultation today.