Is My Limited Company Protected if I Get a Divorce?
If you're a business owner, divorce doesn't just raise personal questions - it raises commercial ones. Perhaps the most common (and emotionally charged) among them is this: can my wife take half my limited company? And the answer - like most things in family law - is: it depends.
Under UK law, limited companies aren’t automatically ringfenced in divorce proceedings, even if you’re the sole director or shareholder. Business assets, in most cases, are considered matrimonial assets - particularly if they were built during the marriage or supported indirectly by the other spouse (whether financially, domestically, or otherwise).
That’s not to say your ex will suddenly become co-director or be handed half your shares - but the company’s value will be taken into account when dividing assets. And if you’re not prepared, you could find yourself handing over a portion of the company’s worth - or making significant financial concessions elsewhere to retain full control.
In this guide, we break down what happens to limited companies in divorce, how courts approach valuation, and what you can do to protect your business from unintended fallout. We'll also explain how to get legal clarity on protecting business assets in divorce - before things become contentious.
Are Limited Companies Considered Matrimonial Assets?
In many cases, yes. If your limited company was started or grew significantly during the course of your marriage, it will likely be seen as part of the shared financial landscape of your relationship. That means it can be included in the total marital pot - alongside property, savings, pensions, and other investments.
The court isn’t just looking at formal ownership. It will consider the reality of how the business functions: Was your spouse involved? Did they support you while you built it? Did marital funds go into it - or did income from the company support the household?
Even if you established the company before marriage, it can still be subject to division if your spouse contributed in ways the court considers material - and they often do. The court’s overriding concern is fairness, and that includes acknowledging contributions that may not be reflected on paper.
Will I Have to Give Up Shares or Control?
Not necessarily. While the value of the company may be factored into the settlement, courts are typically reluctant to break up or interfere with the running of a business - especially if it's a sole proprietorship or a small operation that would suffer from interference.
What’s more likely is an offset. For example, you may be allowed to keep full ownership of the company in exchange for your spouse receiving a larger share of other assets - such as equity in the home, savings, or a pension split.
That said, if your business is the primary or only source of wealth in the marriage, the stakes are higher. You may be required to pay out a lump sum based on the company's valuation, or agree to structured payments over time.
And here's the kicker: business valuations are not exact sciences. Accountants may disagree wildly depending on whether they’re acting for you or your ex. There’s room for argument - and risk.
How Is a Limited Company Valued in Divorce?
Valuing a company in divorce is complex and often contested. The court may appoint a single joint expert (usually a forensic accountant) to assess the company’s worth based on:
- Tangible assets (equipment, property, etc.)
- Profitability and turnover
- Market position and client base
- Future earning potential
- Your role in the business (can it run without you?)
This valuation doesn’t just determine what the business is “worth” in an abstract sense - it helps the court understand your financial capacity, now and in future. If the business generates high income, that too will factor into any spousal maintenance decisions, especially where children are involved.
It’s not unusual for valuations to vary depending on whether the business is service-based, product-driven, or IP-heavy - and that’s before tax implications or liquidity challenges are factored in.
Can I Protect My Business Before or During Marriage?
Yes - and ideally, you should. The best time to safeguard your business is before problems arise. Prenuptial agreements or postnuptial agreements can outline exactly what will happen to your business in the event of divorce. While not technically binding, UK courts increasingly uphold them - as long as they’re fair, transparent, and entered into willingly - and most importantly, if both parties' housing needs or otherwise have been met.
If you're already married (or already divorcing), there are still things you can do. Keeping company accounts separate from personal finances, paying yourself a reasonable salary (rather than leaving wealth tied up in the business), and properly documenting shareholder arrangements all help.
If you're in a position of uncertainty now, it's not too late to seek advice and discover family law support in London - whether you're contemplating separation or just want to plan for the future.
Final Thoughts
So - can your wife take half your limited company in a divorce? Any spouse - male or female - is unlikely to end up with shares, a directorial role, or access to business operations. But the value of that company will almost certainly play a role in the financial settlement. And if you don’t take steps to manage that early, you may be left making sacrifices you hadn’t anticipated.
The key is preparation. Understand how your business fits into the broader picture of matrimonial assets, know your valuation risks, and act early to protect what you’ve built.
Whether you're preparing for divorce or simply planning ahead, our team at Skylark Hill can offer strategic, commercially minded advice tailored to your circumstances. Because protecting your company isn’t just about spreadsheets or shareholder agreements - it’s about securing your future on your terms.
