What is financial disclosure in divorce proceedings?

When a marriage breaks down one of the main concerns is who gets what financially and how to achieve a fair and just financial settlement. Anything agreed must work for each of you in both the short and the long term.

What is financial disclosure?

Financial disclosure is part of the process of agreeing a financial settlement. It involves you both providing a full and frank financial disclosure of your income, assets, liabilities and earning potential. This information can then be used to calculate the value of the marital pot and how it is divided between you.

Why is financial disclosure important?

When both parties provide all the necessary financial information, it results in a fair settlement designed to protect both parties into their retirement years.

How do we achieve financial disclosure?

The process of financial disclosure and settlement can be achieved just between yourselves, through mediation, through a family law solicitor or through the courts. Given the complexity of ensuring that both of you are providing a full and frank financial disclosure and that you are both financially provided for in the long term into retirement, we would always recommend using an experienced family lawyer.

The most common way to achieve disclosure is through a financial statement, known as a Form E. This is mandatory when pursuing a financial settlement through the courts but is commonly used for voluntary financial disclosure as it documents details of income, assets and liabilities.

What is involved in completing Form E?

Form E will ask for information which includes the following, along with supporting documentation:

• Assets – properties, bank accounts, businesses, savings, investments and any personal items of high value, such as cars, jewellery and artworks
• Liabilities – mortgages, credit card debts, loans and any other financial obligations
• Income – salary, bonuses, dividends and any self-employed earnings
• Pensions – value of any private, workplace and state pensions
• Future Needs – housing needs, living costs and childcare responsibilities

All of these require documentation to support what has been disclosed, such as pay slips, bank statements, property and pension valuations.

The information must be a ‘full and frank’ account of your finances and you must sign a Statement of Truth to this effect.

Again, we would recommend the assistance of an experienced family lawyer to support you in completing the Form E.

What happens after completing Form E?

You each receive a copy of your ex-partner’s Form E. This is commonly done via your respective solicitors. Both sides can then consider the information and seek further clarification and ratification where necessary. This is done via a document known as the Questionnaire. Once both parties are satisfied with the information provided, the value of the marital pot can be established. Once this has been agreed, a fair settlement between you can be negotiated.

The financial settlement

When you are both happy with the proposed split of the marital pot, the agreement is turned into a Financial Consent Order. This makes it legally binding. Without such an order, both parties are left without legal protection for any future financial claims made by an ex-partner.

If you cannot agree on how your assets and liabilities are divided, you will need to go through the stress, expense and lengthy time delays of the courts, where a judge will make a final ruling on who gets what.

What happens if I do not disclose all my assets?

If it is discovered that you or your ex-partner have failed to disclose all assets, this can lead to court orders to comply, costs penalties, fines and even imprisonment.

If you are struggling with issues arising from separation and divorce, we offer a no obligation initial consultation for a fixed fee of £150 (incl. VAT), for up to one hour. At this meeting, we can advise you on all the issues relating to your personal circumstances, allowing you to make informed decisions moving forward.

To book an appointment please call 01444 472700, email us at info@tisshawssolicitors.co.uk or complete the form below.