Financial Disclosure - What you need know..
What is Financial Disclosure?
Financial disclosure is the process of giving to your spouse or partner, and to the court, full details of your personal financial circumstances and your future needs and resources. It is usually the first thing your family lawyer will ask you to do, as we will be unable to advise you properly about the likely outcome of your case without having a full picture of where both of you are placed financially.
In financial matters, disclosure is essential whatever process you intend to use to achieve a solution: in or out of court. If you do start to use the court process the court will order both of you to complete financial statement a form called Form E before the first court hearing. In non-court processes such as solicitor negotiations mediation or collaborative law, you will need to provide equivalent financial disclosure.
Why is Financial Disclosure necessary?
Both of you need to have full financial information before you can agree how your financial arrangements should be separated out as the law says that the available resources must be split fairly. It is not possible for you, your lawyers or a court to know what will be a fair solution unless everybody knows the full financial picture. There is a continuing obligation to give financial disclosure throughout your case if circumstances change.
What happens if Financial Disclosure is not full and accurate?
You will have to verify the information in Form E with a statement of truth and giving deliberately untruthful information may be a criminal offence or contempt of court. If a court order or agreement is found to have been based on inaccurate information it is possible to ask the court to reopen the case and make a new order, which may result in the court making orders for costs against any person who has failed to provide full and accurate disclosure.
What information is required?
You are required to produce the following financial documents / information:
1. Three most recent pay slips from all employers - You should have been provided with these by your employer. If you have not retained them, you can ask your employer for duplicate copies.
2. Your most recent P60 from all employers - Your employer should have issued you with a P60 at the end of the last tax year in April. If you have not retained a copy you should ask your employer for a duplicate copy. If you receive any pension income you should also produce P60's for all pensions you receive.
3. Your Form P11D from all employers - If you receive any benefits in kind from your employer e.g. company car etc.. you will receive a Form P11D along with your P60. The P11D details the value of your benefits in kind.
4. Last 12 months statements for all bank accounts held in joint names and your sole name - You should be provided with bank statements every month unless you have opted for internet statements. Please provide the last 12 months consecutive statements (less than 12 months is not acceptable unless the account has been opened within the last 12 months). Internet printouts are acceptable if you do not have paper copies. If you have lost or destroyed your bank statements, you can obtain further copies from your bank (there is likely to be a small charge).
5. Last 12 months statements for all building society accounts held in joint names and your sole name - Most building societies operate passbooks as opposed to providing statements. Please ensure that your passbook is up-to-date by taking it to your building society and asking them to update it. Please bring the original passbook with you to our face-to-face meeting. We will take a photocopy of the passbook and give you the original back immediately.
6. Any property valuations obtained within the last 6 months - These may include: mortgage valuations, market appraisals or sales particulars (if the property is on the market for sale). If you have any of these documents please produce them.
7. An up to date mortgage redemption statement - Your lender usually issues a mortgage statement annually which is usually sent to the property. If you have not received a copy or have lost or destroyed it, you can telephone your lender and request an up-to-date mortgage statement. This is usually provided verbally over the telephone and confirmed in writing. There is usually no charge. If you separated some time ago and you have continued to pay the mortgage following separation, you should also obtain a mortgage redemption figure as at the time of separation as you may be entitled to credit for the mortgage payments made by you following separation.
8. Copies of any life / endowment policies and up to date surrender values - When you take out a life policy or endowment policy the insurance company normally issues a policy schedule detailing the terms of the policy. If the policy has an investment value, your insurance company is likely to issue you with an annual statement showing the current value. If you do not have a copy, you can telephone the insurance company and request them to provide an up-to-date valuation. Please request the insurance company to confirm the valuation in writing.
9. Copies of share certificates for all publicly listed shares you own - When you purchased or were issued with the shares, you should have received a share certificate detailing the number and type of shares you own. Please bring copies of all share certificates you own or a statement from your stockbroker detailing your shares and current values. If the shares are listed on the stock exchange you can obtain valuations online.
10. Last 2 years business accounts and tax returns - If you do not have these in your possession, please ask your accountant to provide you with copies or to email copies to us. If you have business interests it may be necessary in the course of the proceedings to have your interest in the business professionally valued. We will discuss this further during our face-to-face meeting. There is no need for you to commission a business valuation at this stage, because any valuation commissioned solely by you is likely to be rejected by the other side and or the court. If a valuation is required, an independent valuer / accountant is likely to be instructed on a joint basis at joint cost.
11. Up to date pension Cash Equivalent Transfer Valuations [CETV's] - You need to produce valuations for all your pensions including: occupational pensions; private pensions; AVC's; retirement contracts; Self Invested Pension Schemes; etc.. You should receive an annual statement for your pension investments which should include an up-to-date valuation. If you do not have recent pension statements (less than 12 months old), you should telephone your pension company and request them to provide an up-to-date CETV or you can download a Form P - Pension Enquiry Form below. You will need to complete the Form P and send it off to your pension provider. Provided the pension is not in payment, there is no charge for the provision of a CETV. Some pension companies can take several weeks to provide a valuation, so please request the valuation as soon as possible. If your case involves significant pension assets, you may need to obtain a specialist pension report from an actuary to advise about how to achieve a fair division of the pension. We will advise you further about this during our face-to-face appointment. Click to download Form P - Pension Enquiry Form.
12. State Second Pension [SP2] valuation - In addition to the Basic State Pension, there is a Second State Pension (SP2). If you are employed, part of your national insurance contributions are paid into the SP2 which will provide you with an enhanced state pension when you reach state retirement age. The SP2 has a valuation and is capable of being shared by the court. You are required to provide an up-to-date valuation for the SP2. You can request a valuation from the Pensions Service or download a copy below. Please then complete the request and send it to the address provided on the form. Click to download Additional State Pension valuation request form.
13. State pension forecast - Your state pension forecast provides details of the state pension you are entitled to based on your national insurance contributions. It can also give details of the basic state pension you will be entitled to following your divorce. You can download a state pension forecast request form below. Please then complete the form and post it to the Pensions Service. Click to download State Pension forecast.
14. Copies of all loan agreements and up to date loan statements - If you have any outstanding debt's whether in your sole name or in joint names, please provide copies of the loan agreements and up-to-date statements showing the current balances outstanding. If you contend that the debts were incurred for joint / family purposes then it may be possible for the debts to be taken into account in the financial settlement. In this event it may also be necessary for you to provide statements showing how the debt was incurred and the balance as at the time of separation. We will discuss this further we you during your face-to-face meeting.
15. Schedule of expenditure - Form E requires you to provide details of your monthly expenditure. Please complete the schedule of expenditure which is available to download below. The schedule has two columns: current expenditure; and future expenditure. You only need to complete the future expenditure column if you anticipate your current expenditure changing. To calculate monthly expenditure from a weekly figure, please multiply by 52 and divide by 12. If your case potentially involves spousal maintenance it is important that you complete the schedule as accurately as possible. We will review the schedule with you during our meeting to finalise your statement. Click to download Schedule of Expenditure.
16. Any other relevant financial documents - If you have any other relevant financial documentation please bring it to your appointment no matter how should unimportant you think it might be. We will review it with you and advise as to how important it is.
Are household contents in issue?
If household contents are in issue please download the Schedule of Contents. You will need to provide a description of the items you wish to retain and an explanation about why you would like the item e.g: you purchased the item; it was a gift to you; you need it for the children; you have the debt relating to the item; etc.. Click to download Schedule of Contents.
Once you have obtained all of your financial disclosure, please make a face-to face appointment to finalise your disclosure and to discuss settlement proposals in your case. During your face-to-face meeting we will discuss with you all the relevant issues / factors in your case, and possible settlement outcomes (subject to receiving your ex-spouses financial information).
Need further guidance? Download our fact sheet
If you need further guidance about the financial application, we have prepared a financial applications fact sheet which gives general information and guidance about financial proceedings and timescales. We hope that our fact sheet answers most of your queries about financial proceedings, but if you have any further queries please contact us for further assistance. Click to download Financial Issues fact sheet.