Dividing the Value of a Business During an Ottawa High-Asset Divorce

When you are worried about dividing the value of a business during an Ottawa high-asset divorce, you need solid legal guidance to know how to proceed. This is particularly important when you have a successful business that has contributed to your high net worth.

An experienced business divorce lawyer from The Riley Divorce & Family Law Firm could help you figure out the aspects of the business that may be affected by the divorce, ensure that your business is appropriately valued, and seek ways to encourage the filing party to take alternative settlement options instead of wrecking the business. Contact us to discuss your legal options today.

Steps for Valuing a Spouse’s Business Interests

Before a person’s business assets are divided during a divorce, the value must first be ascertained by financial experts and business valuators in Ottawa. The process of establishing a divorcing partner’s business interests includes:

• Assessing the business value using a market, asset, or income method
• Considering the contending spouse’s “added value” to the business after marriage
• Establishing the value of the business before the business owner or investor got married
• Figuring out the partner’s business stake, whether they own a percentage or fully own the business
• Procuring the business’s financial records, including its tax returns, financial statements, and bank records
• Engaging the services of experienced Chartered Business Valuators (CBVs) and high-asset divorce lawyers to establish how much the business is worth
• Identifying the date of official separation between the married couple, which could limit the possible extent of the demanding partner’s claim on the business

After figuring out these details, an appropriate value can be applied to the business. If both parties agree that the value makes sense, they move forward with the next steps. If not, they may have to file a case before a judge, who then independently assigns a value after due diligence.

What Factors Affect Receivables From a Partner’s Business Stake?

If a spouse contributed in some way to their partner’s business growth, that assigned value becomes part of what is known as net family property. A primary aspect of the net family property is equalization. Under Canada’s Family Law Act, which guides the equalization of net family property, the higher net worth spouse is required to pay the lower net worth spouse half of the difference in their net worth.

For instance, if the business added a net worth of $800,000 after marriage to one spouse, but the second partner only added $200,000 to their net worth, the higher net worth spouse will be required to pay the lower net worth spouse an additional $300,000, or half of the $600,000 difference in net worth.

Of course, this is all determined after considering the business’s assets and liabilities, and determining what is actually available to be split. However, the courts may consider certain exceptions when making their final ruling. The dedicated lawyers from our firm could help you understand what unique circumstances may apply to dividing the value of your business assets and ensure a smooth process in your Ottawa high-asset divorce proceedings.

Contact a High-Asset Divorce Lawyer in Ottawa For Help With Dividing Your Business Assets

The highly complex nature of dividing the value of a business during an Ottawa high-asset divorce often requires the skills of experienced family lawyers from The Riley Divorce & Family Law Firm. Our lawyers will work with you and bring on other outside experts, where necessary, to accurately determine your business’s value and figure out the right amount of equalization payment that you owe or are owed. Call us to discuss your legal options today. We are available 24-hours a day to assist you.