A guide to high net worth divorces

Regardless of the assets in a case, an application for divorce and the prospect of trying to reach a financial settlement can be daunting. However, high net worth cases can quickly become more complex.

This is largely because of the type of assets involved and potentially not all assets being within the UK. Whilst the preference would always be to try and engage in voluntary disclosure and to reach agreements without judicial intervention, this is often much more difficult where there are complex issues requiring experts.  

Common assets in high net worth cases include, but are not limited to:

Businesses - With either party having interests in a business, it is necessary to ascertain the capital and income value of their share of the business. Whilst the business and share value can be agreed, we often see the need for a professional valuation report to be prepared and for the court to instruct such a report on a joint basis. Once the business and share values have been agreed or ordered, the next stage will be to look at how the business interests should be split between the parties. The court will always try to ensure the business will not close as a result of any settlement. It is typically in both parties' best interests for the business to remain a going concern.   

Property – High net cases will usually include a property portfolio, which can comprise jointly owned houses, houses in one parties name and not the other, houses including third parties, houses outside of the UK. Interim assurances, restrictions and orders are sometimes needed to secure these assets. Ultimately, the interests of each party need to be agreed and an appropriate settlement of the properties concluded, including transfer of property and sale.

Pensions -  Cases of high net worth will commonly also include pensions. This is particularly true of high income cases, where pension contributions are often maximised for tax efficiency. Due to the complexity of pensions it is often necessary for there to be a pension expert report to advise the parties and their solicitors on viable and most effective options.

Investments - Other assets will also commonly include shares, inside and outside tax efficient wrappers such as ISAs. The last few years have also seen an increase in cryptocurrency investments, such as Bitcoin.

It will be an essential task to determine the value of all assets in the case as accurately as possible. It is essential not to make assumptions, but to seek expert advice where needed. Collectively, between your solicitor and experts, you can then make informed decisions and enter into negotiations for settlement.

If you are contemplating a divorce that is likely to involve complex, higher value assets as part of any financial settlement, please contact our team of specialists for an early discussion and advice.