Industry Insights for Accountants: Working with Family Lawyers
When a relationship is breaking down, the first professional advice people tend to seek is financial: How do you best protect your assets?
Whilst accountants and financial advisers will be able to assist with asset protection to some degree, consulting a family lawyer is equally important. The best results can be reached when accountants and family lawyers work together to find the most suitable solutions for their clients.
Relationship breakdown or divorce
Whilst so called normal methods of asset protection may be appropriate for financial reasons such as tax optimisation, the same methods may not protect your clients’ assets when they are going through separation or divorce proceedings.
Family law property settlement matters take into account the parties’ all assets whether or not in their personal name. Assets seemingly protected in a family discretionary trust may form part of the divisible property if these trusts are not set up properly. More information on discretionary trusts and the family law system can be found here. However, separation is not the only time when accountants and family lawyers should be working together to achieve the best financial outcomes for their clients.
Financial Planning for the Future
When setting up business structures and family trusts for clients, accountants and clients alike should consult family lawyers so that those financial structures are actually achieving their desired purpose, asset protection. Future proofing family assets is forward thinking financial planning and cooperation of accountants and family lawyers in this process will assist in keeping assets in the family in case of separation or divorce sometime in the future.
Family lawyers may need assistance from accountants when setting up Binding Financial Agreements for their clients. In order for family lawyers to understand the financial position of their clients, consulting the client’s accountant is essential. As Financial Agreements can be seen as a form of asset protection, it is important the family lawyers get all the necessary information that they need to draft Financial Agreements cover all of their client’s financial affairs. For more information on Financial Agreements read our blog post.
For more information on how accountants and financial advisers are involved in Family Law matters, visit our other blog posts on the topic: