Such situations are all too common. Entrepreneurs and pro-
fessionals who devote their lives to creating a thriving business are oſten ill-prepared for family breakdown. When it comes — a stark reality for many — the aftermath can ruin a lifetime of hard work and devastate their most valuable asset. This article will explain the rules governing property division
in divorce and provide effective tools and strategies that could help protect your business from the negative impacts of a marital breakdown.
Yours, mine and ours While the federal government has the constitutional authority to sanction a divorce under the Divorce Act, the provinces and territories handle the division of a married couple’s assets subject to provincial and territorial statutes. In Ontario, for example, that statute is the Family Law Act. In Alberta, it’s the Matrimonial Property Act. Regardless of where you live in Canada, marriages are viewed
as economic partnerships and for the most part assets you acquire while married are viewed as community property.
Some exceptions include giſts or inheritances received from third parties during the marriage, property received as damages for personal injuries and property that the couple has chosen to exclude in a domestic contract. Word to the wise: sometimes these exceptions will no longer
be considered separate if mixed or commingled with marital property. For example, in Ontario, if you use the inheritance from your parents to pay down the joint mortgage, then that money is now considered commingled and becomes part of the community property to be shared equally should you separate. Family law statutes do not assign ownership of the assets, so
the province or territory will not be deciding who gets what. Rather, family laws ensure that spouses end up with equal net family assets, with the spouse who has more making an equal- ization payment to the spouse who has less. What is included as an asset varies by jurisdiction (i.e. different provinces/territo- ries). In some provinces, business assets are not shared. For example, on separation in Ontario, spouse A owns a busi- ness worth $400,000 and has $100,000 in savings. Spouse B has
APRIL 2015 | CPA MAGAZINE | 37
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60