The current policy of isolation has for the majority shrunk our social circle down to our immediate family in our primary homes. The Government has been very scathing towards the few that have been flouting the ‘stay at home, save lives’ rule and the resignation of Scotland’s Chief Medical Officer makes clear that trips to second homes are not an exception to the rule.
For many couples this has meant that they are spending greater time than normal in each other’s company, within a confined space. This puts pressure on even the strongest relationship, and it is not surprising that there has been a reported rise in internet searches for ‘divorce’. In our usual day-to-day lives people are able to put aside marital difficulties by socialising with others and attending work events. With that no longer being possible couples are forced to confront the realities of their home situation with many deciding that separation is sadly inevitable.
On the financial side, many of our High Net Worth and Ultra High Net Worth clients are seeing the value of their portfolio of investments reduced as a result of the current coronavirus (COVID-19) pandemic. Assets may have fallen in value in the short term and therefore there is less to be divided between spouses. Whilst not an ideal situation, if clients have confidence that in the future their portfolio will likely stabilise, they are seeing now it as an opportunity to resolve their divorce and financial settlements.
For many separated couples, one of the primary assets is the formal marital home (FMH). The UK housing market is currently seeing a delay in the sale of residential properties across the board. This delay may also trigger capital gains tax, if they have left the FMH and are living in a different property to their spouse post separation. We have an ongoing dialogue with trusted independent financial advisors and tax specialists on this issue and early advice should be sought from such experts. Any liabilities, including tax, should be considered as part of the overall financial settlement.
There may also be different aspects to the financial negotiations to consider due to the current market volatility. We, as your legal representative, will think ‘outside the box’ and come up with innovative solutions. For instance, it may be prudent to think about percentage sharing, as opposed to providing your spouse with a fixed lump sum payment. It may also be sensible to put clauses in a Consent Order to set lower and upper limits concerning asset shares.
It is important to remember, however, that every family is different, so if you do have concerns, reach out to one of our specialist solicitors at Osbourne Pinner for tailored legal advice on or fill in the form for a call back.