Protecting your Money and Assets through a Separation or Divorce

Protecting your Money and Assets through a Separation or Divorce

If you are thinking of separating or divorcing you are likely trying to think of ways that you can protect your money and assets. If you are divorcing in Ontario, the Ontario Family Law Act (the "Act") sets out specific and sometimes complicated rules regarding the treatment of marital property.

Essentially, the Ontario Family Law Act requires married spouses to share equally in any increase or decrease in the value of their property over the course of the marriage.

Property is defined in the Ontario Family Law Act very broadly and encompasses "any interest, present or future, vested or contingent, in real or personal property". Essentially, anything that can be considered property will be considered property for the purposes of the Act.

The process requires each spouse to determine the net value of all the property he or she owns at the end of the marriage and to subtract from that amount the net value of the property owned as of the date of marriage, taking into account certain exclusions permitted by the Ontario Family Law Act.

The value arrived at is referred to in the legislation as a spouse's net family property. The spouse with the lesser net family property is entitled to receive, typically by way of cash payment, one-half the difference between the two net family properties. That is, if the net family properties are equalized.

Having said that, a spouse can minimize the amount of any equalization payment he or she might be required to make through careful structuring of his or her portfolio in a manner that takes full advantage of the deductions and exclusions allowed by the legislation.

If you are in a situation where you and your spouse share substantial money/assets, this is one scenario where you should consider consulting an Ontario divorce lawyer.

If you are the party who is in a stronger financial position, you should look for an Ontario Divorce lawyer that specializes in equalization. A lawyer that specializes in equalization will be able to assess your exposure and help you come up with strategies to protect your property.

If you are the party who is in a weaker financial position you too should seek an Ontario divorce lawyer who specializes in Equalization in Ontario to ensure that you receive a fair and equitable divorce settlement.

Being proactive about protecting your wealth is essential. Waiting until you and your spouse have agreed to separate or divorce before starting to implement wealth preservation strategies is not an option.

As a prudent business person, your tax plan is to minimize taxes. Your business plan is to minimize expenses and maximize profit. Yet, when beginning or ending a relationship, people seldom plan to protect their assets from the consequences of marriage or separation.

To learn the strategies to protect your money and assets through a separation or divorce, go to www.BermanBarristers.com.

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