Don’t Know What is Fair? The Importance of Financial Disclosure

Trying to figure out what is going to happen in a divorce is sometimes tricky. Alongside emotional challenges, there are often difficult decisions to make about the family home, savings, pensions, and future financial security. Any outcome should be fair. But, how do you work out what is fair? One of key steps in reaching a fair financial settlement is ensuring that both parties are open and honest about their finances. 

In England and Wales, each party to a divorce has a legal duty to provide full and frank financial disclosure. This means sharing accurate information about your income, property, savings, investments, pensions, debts, and any other assets you have an interest in. 

While it may feel intrusive, financial disclosure is designed to protect both parties. It ensures that everyone is making decisions based on the same information and helps avoid unpleasant surprises later. 

Why is financial disclosure so important?

A financial settlement can only be fair if both people understand the true financial position. Whether you are negotiating directly or through solicitors, attending mediation, or asking the court to decide matters, accurate financial information is essential. 

Being transparent can also help reduce conflict. When both parties know where they stand financially, discussions are often more productive, and agreements can be reached more quickly. This can save both time and legal costs, while reducing the stress that can often accompany a divorce. 

What happens is someone hides assets?

There is sometimes a worry that one or other party may have undisclosed savings, investments or other assets. Others may be tempted to understate their income or transfer assets to family members, for example, in the hope they will not be discovered. 

The court takes a very serious view of any attempt to conceal financial information. If it is found that someone has deliberately failed to provide full disclosure the court has the paid to make inferences, order that person to pay legal costs and, in some cases, re-open a Financial Order. 

Financial disclosure is an ongoing duty

They duty to disclosure does not end once the initial paperwork has been exchanged. If your financial circumstances change during the process, you should update the other party and the court if proceedings are ongoing. 

Seeking the right advice

Each family’s circumstances are different. Obtaining early legal advice can help you understand your obligations and protect your interests. 

If you believe the other party has not been honest about their finances, there are legal steps that can be taken to obtain further information and, where appropriate, investigate missing assets. 

If you are unsure about your legal position and feel you would benefit from legal advice on your options, please get in touch via our contact page or contact our Family Law Department on 01295 204000.