What Is Financial Disclosure In Divorce & How Does It Work?

What is Financial Disclosure In Divorce?

Financial disclosure describes the process of each party to a divorce providing financial details such as your income, assets, and any liabilities.

Financial disclosure is made through Form E, which is a detailed document outlining the overall ‘matrimonial pot’.

It helps the court assess the financial resources of both parties and make decisions regarding the division of assets, payment of maintenance, and other financial arrangements.

What is the purpose of Financial Disclosure?

The purpose of financial disclosure is to ensure a fair and equitable division of assets and to prevent one party from hiding assets or income from the other.

Irrespective of your financial circumstances, it’s vitally important that you address it as part of your divorce as the Final Order does not end your ties – it merely ends the marriage contract.

If you have limited assets to separate, you may be able to obtain a clean break order. For longer marriages, this may not be possible and financial disclosure becomes even more important.

Financial disclosure is required by law, and non-disclosure or providing false information in the disclosure process can have serious legal consequences.

The court can set aside any agreement or order that is made if it is later discovered that one party failed to provide full disclosure of all their assets or income.

In extreme cases, a party can even be held in contempt of court, which can result in fines, imprisonment, or both.

Why is financial disclosure important in divorce proceedings in England and Wales?

Here are four reasons financial disclosure is important in divorce proceedings in England and Wales:

1) To ensure a fair and equitable division of assets

When you get divorced, your assets and liabilities will be divided between you and your ex-spouse.

This can include everything from property and investments to bank accounts and pensions.

In order to ensure a fair and equitable division of assets, it’s important that both parties provide a comprehensive list of all their assets and liabilities.

This allows the court to make an informed decision about how to divide the assets.

2) To prevent one party from hiding assets or income

Unfortunately, some people may try to hide assets or income from their ex-spouse during the divorce process. This is known as non-disclosure.

This can be done by transferring assets to friends or family members, or by failing to disclose all their income.

By requiring full and frank financial disclosure, the court can prevent one party from hiding assets or income, and ensure that all assets are included in the division of assets.

As part of the divorce disclosure process, both parties must sign a Statement of Truth. This statement of truth affirms that the information provided is accurate and complete to the best of their knowledge.

3) To ensure a Consent Order reflects the financial arrangements accurately

A Consent Order is a legal document that sets out the financial arrangements between you and your ex-spouse after your divorce.

It’s important that the Consent Order accurately reflects your financial arrangements, as it is a binding legal document.

In order to ensure that the financial order is accurate, it’s essential that both parties provide full and accurate financial disclosure.

4) To avoid future disputes

Finally, full and accurate financial disclosure can help to prevent future disputes between the parties.

By providing a comprehensive list of all assets and liabilities, both parties can be confident that the division of assets is fair and equitable.

This can help to avoid disputes in the future and can ensure that both parties can move on with their lives.

In England and Wales, financial disclosure is required by law during divorce proceedings.

It’s important to work with a family law solicitor to ensure that you provide full and accurate financial disclosure, and to ensure that the division of assets is fair and equitable.

This can help to prevent future disputes and can ensure that both parties can move on with their lives after the divorce.

If you have any questions or concerns about financial disclosure or the divorce process, don’t hesitate to contact a family law solicitor for guidance and support

What Financial Information Do I Need To Disclose?

The financial statement you need to complete is known as Form E; it’s a long and often complex document.

If you would prefer to complete just one simple online questionnaire then speak to us on live chat to find out how our service streamlines the process.

Here is an overview of the types of information you will need to gather to complete Form E:

• Income: Both parties should disclose their sources of income, including employment income (payslips), rental income, dividends, and any other forms of earnings including bank statements.
• Assets: List all assets, such as properties, investments, savings accounts, pensions, business accounts, and valuable possessions.
• Liabilities: Disclose all debts, loans, mortgages, and other financial obligations.
• Expenses: Provide information about regular expenses, including housing costs, utilities, childcare expenses, and more.

Accurately determining the values of assets is a fundamental part of financial disclosure. Whether it’s property, investments, or business accounts, understanding their true worth ensures that both parties receive a fair share.

For high-value assets, such as property or businesses, expert valuations may be required to establish these values accurately.

Conclusion

Family law solicitors play a key role in ensuring that the financial disclosure is complete and accurate, providing reassurance and confidence to their clients. They help gather and verify necessary documents, facilitating a smoother and more transparent divorce settlement process.

The court takes into account many factors when deciding on financial orders. A court can only make a judgement once they have the full picture of both parties’ financial positions.

Seeking legal advice from experienced family solicitors is crucial throughout the divorce process, especially when navigating the complexities of financial disclosure.

Whether you are dissolving a marriage or a civil partnership, a thorough understanding of financial disclosure can significantly impact the outcome of your case.

Solicitors can provide guidance on the legal requirements, the court process and help clients gather the necessary documents, and negotiate on their behalf to reach a fair settlement.