Jul 13, 2016
Areas of law are often viewed as separate entities. For example, if you have a family law matter, most average Australians would view business law as separate and detached. However, in reality, your business life and your family life will be closely linked if you have a family law matter.
There are 2 ways your business can be viewed:
- As an asset; and
- As a financial resource.
Whether a business is viewed as an asset, a financial resource or both will largely depend on what type of business it is. This blog post will look at briefly the issues which arise when your business is viewed as a financial resource.
Business as a Financial Resource
A business can be viewed as a financial resource, or something that provides an income and therefore increases your earning capacity. If you own a business (or own shares in a business), you are likely to receive income in the form of a salary, profits and/or dividends.
If a business is viewed as a financial resource it is not considered part of the asset pool. Rather, it is a factor which impacts your future needs. If your business provides a considerable income, and is likely to continue to do so into the future, then you have a greater earning capacity. This means that the proportion of the property pool allocated to you in light of your future needs will be smaller. Keep in mind a financial resource is only one factor in a long list of contributions and other factors such as health and dependents are also taken into account when making an equitable property split.
If you have a family law matter, concerns about your family business or questions about family law and separation in NSW and want to find out more please do not hesitate to contact us on 9688 6023 or email us at info@franklegal.com.au
This article is provided to the reader for general information. It is not legal advice. It was written by Andrea Spencer & Emily Graham and edited by James Frank.
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