When assisting separating couples through the transition process, we find that the clients’ trusted accountants provide invaluable support throughout the various stages of the matter.
A separation is one of the most difficult life events a person can experience, and as such it can easily cause distraction. Some clients lose focus on their business for example, forgetting to ensure the business is trading profitably and not keeping taxation lodgments up to date.
Not only is it necessary for returns to be maintained for disclosure purposes and to ensure all taxation liabilities are accounted for in the family law proceedings, but non-compliance can potentially result and other serious consequences. This can include the issue of garnishee and director penalty notices by the ATO.
Up to date returns and accounts greatly assist in ensuring that potential issues are identified and properly managed, for example Division 7A loans, as well as ensuring that accurate figures are available for negotiation purposes.
The disclosure process represents a broad and ongoing duty imposed on the client, with parties obliged to produce copies of all documents relating to their financial affairs. This can include everything from bank statements, to trust deeds, financial statements and general ledgers.
It is surprisingly common for clients to be unfamiliar with various aspects of their financial affairs and the existence of certain documents. This is especially so where one party has primarily managed the family or business finances and/or there are complex structures in place. In these cases, it is often more efficient and cost effective for us to liaise directly with accountants in collating the disclosure documents.
Although we communicate regularly with our clients and ensure they are always up-to-date, we will often seek a client’s authority to liaise directly with their accountant from the outset to avoid potential delays and improve efficiency throughout the matter. We find that by obtaining this authority early the disclosure process can be undertaken more efficiently and economically for the client also.
It is our preference that accountants are kept involved throughout settlement negotiations. Their intimate knowledge of the client’s financial position ensures that potential advantages and opportunities to add value to a settlement are identified and leveraged. This can include making use of the available capital gains tax and stamp duty exceptions to conduct a restructure that can benefit the client moving forward.
Finally, accountants often play a major role in assisting with the implementation of any financial outcomes that form part of the resolution, including superannuation splits for self-managed superannuation funds.
If you would like to learn more about how accountants and family lawyers can work together to ensure the best outcome for clients, or to set up an initial consult to discuss how we could help you, contact our Toowoomba Family Law team today. You can reach our Brisbane and Toowoomba lawyers teams on 1300 068 736, contact us today.
This publication has been carefully prepared, but it has been written in general terms and should be viewed as broad guidance only. It does not purport to be comprehensive or to render advice. No one should rely on the information contained in this publication without first obtaining professional advice relevant to their own specific situation.