A Guide to the Special Considerations needed for High Net Worth Divorces
From disputes about where the family horse will reside to paying for private school fees, fair divorces amongst the wealthiest individuals in society require a particular legal approach.
High net worth divorces differ greatly from divorces between couples with fewer assets (to include fewer assets in general as well as lower in value).
Carlsons Solicitors regularly represents the best interests of our clients in high net worth divorces, often involving high-profile individuals.
This guide aims to promote awareness of the special considerations needed to settle a divorce in your best interests when you have a lot at stake.
High net worth definition (UK)
A high net worth divorce usually includes a considerable portfolio of assets, including properties, income-generating assets, such as businesses, inherited estates or offshore assets. HMRC defines a high net worth (or HNW) individual as one with assets from £10 to £20 million or more. However, there is no precise legal definition of what a high net worth divorce might involve.
When a couple has a significant estate, including income-generating assets, high net worth individuals need a solicitor with extra skill and expertise. A firm with significant experience in high net worth divorce proceedings should always be instructed at the earliest stage possible.
High net worth divorces: how are they different to ‘normal’ divorces?
High net worth divorces can involve assets in multiple different forms, often consisting of property, business shares, overseas assets and inherited estates or trusts.
For this reason, high net worth divorces can involve a more in-depth approach to distributing these assets in a way the court deems fair to both parties and any children (or other dependants).
Often, your legal team may take on an additional role as investigators, unravelling the true extent of your partner’s wealth, and persuading the courts to see the reality of your situation.
Some areas which may be more contentious (which here means: may cause more of a headache) in a high net worth divorce include:
- Division of business assets
- Trust issues (not the feelings kind; we mean the monetary kind)
- Assets that have been inherited
- Assets located offshore, typically this can include company assets or international businesses
- Other jurisdictional aspects. This might include problems about where to divorce, or enforcing a judgment or court order in a different jurisdiction
- Properties, including the main residence and any holiday homes or lettings portfolios
- School, university or nursery fees for children, as well as extra-curricular activities (Child arrangement orders may be relevant here)
- Spousal and child maintenance payments – the bar for what is ‘fair’ and meets the needs of spouses and children can be considerably higher than in a lower-value divorce
- Prenuptial agreements, including whether one exists, its enforceability and what assets were included (which may have changed)
- Problems with disclosure
Conclusion
The process of achieving what a court will consider a ‘fair’ settlement can be much more involved with a high net worth divorce.
To achieve a result that works in your interests as much as possible, it is imperative to get legal advice at the earliest stage that you can. This will help to reduce the likelihood of losing important assets, ensuring that you come out of the divorce in the best position possible.
Get in touch with Carlsons Solicitors, and we’ll be on hand to provide you with advice for your particular circumstances.