I think my FDR is going to be quite complicated compared to some and maybe not so much as others but i have a question in how people think this may go, specifically about the company.
My consultancy ltd company has a net value of around 800k, this consists of 3 properties valued at £380k and cash of around £420k. There are cash savings of around 200k, not much in the way of pensions though. I own 70% of the company and my wife 30%.My wife has agreed to take a property from the company as part of any deal, the specific house is around £180k, marital home she is also keeping and this is around £280k so her value is already at £460k. When deciding how much the rest is worth, how would it go on FDR day ?
If the company is not closed down then any cash i remove is taxed as a dividend at 38%. Does the court deal in the hypothetical, ie if the company was closed then 20% would need to be paid for me to continue trading, im confused how they would split the assets in the company
At the FDR it is up to you both to make offers and negotiate based on a schedule of the assets you have between you and your respective needs. The assets should be put in at net value. So the property is the value net of any mortgage, sale costs (3% is a generally accepted figure) and, for rental properties, CGT. I would imagine that the business value should factor in the costs involved in converting assets to cash.
I have looked back at your posts and can see that yours is a long marriage during which your ex has not worked.
You need to work out a proposal that allows for you both to be housed and to have a reasonable income now and in the future. If this can be achieved by signing over one or more rental properties to her, that may well allow for there to be a clean break. After a long marriage the start point for dividing the assets would be 50:50. Any departure from this would need to be justified.
I normally suggest you go in with three figures in mind.
1: Your first without prejudice offer which would be best case scenario for you, taking into account her needs for housing etc. Bear in mind that with no dependent children the strict need for each of you is a 1-2 bed property. Make sure you include some negotiating points ie things you would be prepared to give way on.
2. The settlement you would be happy to live with. This would be a lower figure than 1 and assumes you would concede some of the negotiating points. You also need to consider the costs involved in going to final hearing.
3. Your worst case scenario. This would be the point below which the settlement would be unacceptable to you. This may be after conceding all of your negotiating points.
If you are represented this would generally be at least double what has been spent on representation to FDR.
If you cannot get a better deal than 3 at FDR, and if the judge indicates that the offer you have put on the table is fair, you may want to consider not settling at FDR but going away and preparing an open offer to save the costs (to you both) of going all the way to final hearing. If the judge feels your offer is not fair you should consider carefully what they have to say and also factor in the likely costs of final hearing. Again you can not settle on the day but make an open offer shortly after the hearing.
Thanks for the reply, for sure i want a clean break. You say you cannot do a deal at the FDR ?, my solicitor told me that the judge will probably tell both of us that he wants a deal done on the day as nobody wants to go to a final contested hearing ?
2 things i am looking for is for my barrister to try and get some concession on her right to a 50/50 split on the income that i have had in the last 18 months since i left, also no maintenance based on her need being met by a rental property which has no mortgage, a marital home with no mortgage and cash lump sum.
Thanks for the reply.
I have seen a few times on here about a basic need for a 1 to 2 bed house being the standard if divorcing. My wife has already stated she wants the marital home which is 4 bed at +/- 280k, does this mean that the court would look at her to downsize in order to raise some capital and to help her needs going forward ?, she will get a rental property which is around 180k and i think around 100 to 150k in cash.