Why Knowledge is Power in Family Law Matters
“While separation of assets may never be truly equitable, we should always strive to achieve fairness…”
AUTHOR: KATE SMITH
Family law matters are by their very nature complex, emotional and for the parties involved, they can be all-consuming.
Add to that the pressures the COVID-19 pandemic has had on many family run businesses and their financial returns and the environment is a perfect storm for tensions to run high.
In a lot of family law matters, the family members do not have the same level of understanding of the financial complexities. This inequity of understanding can have long lasting consequences.
It is important for all parties that they have the same level of knowledge which can be achieved through a collaborate approach with the legal team and trusted business advisors who collectively, have a unique understanding of the complexities involved without the emotional pressures.
Family law property settlements more often than not involve the transfer of real property, shares and business interests held in various structures. There are wide ranging tax implications of such transactions that need to be identified at the outset so as not to cause unexpected issues down the track.
While separation of assets may never be truly equitable, we should always strive to achieve fairness.
Matters to consider in family property pool negotiations include:
- Valuation of the business and assets
- Forensic accounting
- Future business cashflow
- Ability to refinance or obtain future financing based on lower asset values and higher debt
- Unravelling complex financial structures
- Restructure opportunities
- Ability to hold assets in a tax effective manner
- Restrictions on future asset protection
- Post COVID-19 business strategies
Whether it’s the benefits of potential tax-free assets such as the principal place of residence, or the future risk or taxation liabilities attached to other assets such as shares, property, previous business financing and issues that Division 7A loans may present- it is important that all parties in family law matters have a full and comprehensive understanding of their new situation.
The expert team at PVW Partners has the experience and collaborative approach to achieve the best possible outcomes for the financial future.
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ABOUT THE AUTHOR:
Kate has over 20 years’ experience in accounting, taxation and business advisory.
She is passionate about the agribusiness sector and has extensive experience advising small to medium family enterprises.
Outside of PVW Partners, Kate is a Board Member on the Townsville Chamber of Commerce and Townsville Hospital Foundation.
AREAS OF EXPERTISE
- Tax and accounting
- Taxation planning and advice for Family Law
- Agricultural enterprises and small to medium family enterprises
- Business advisory