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Completing a financial statement, otherwise known as a Form E, is the way that most couples provide full and frank financial disclosure during the divorce process.
In addition to fully completing this document, one of the requirements of Form E is that each individual has to provide details of all bank accounts held over the previous 12 months. You have to provide information including:
- Bank or building society name (includes National Savings)
- The type of account
- Your sort code and account number
- The name of the account holder (you must include joint accounts)
- The current balance of the account.
In addition to this, you have to also provide 12 months’ bank statements for each account. This is not just for your main account, but for all accounts in your name (or joint name).
Providing some statements or partial information is insufficient: you must supply a full year’s statements for each account.
What happens if I don’t provide bank statements?
Honest disclosure is a key element when you seek to reach a financial settlement on divorce. Your solicitors, the other party, and the Court need to see the entire picture in order to make a fair decision.
If you do not provide the bank statements that are requested, adverse inference may be given. This may be wrong and you may simply have not provided the right statements. It is not worth the risk to exclude any information, deliberately or otherwise.
If you refuse to divulge your financial information to your spouse, then they can make an application to the court which can order you to provide your financial information within a certain time limit. If you still fail to provide bank statements, etc then you can be found in contempt of court. In this instance the punishment can be a fine or even a prison sentence.
A case in 2017 saw a husband described by a judge as a ‘serial non-discloser’. His failure to provide supporting documents resulted in a judgement that awarded the wife more than 55% of the total assets.
Two appeals to the Supreme Court in 2015 also considered the issue of non-disclosure. In both cases, one party had deliberately failed to disclose some of their financial information during the initial divorce proceedings. Once this non-disclosure become apparent, both the other parties were then able to set aside the original settlement.
These cases underline the principle that both parties in a divorce have an ongoing duty to provide bank statements and any other financial information that is required.
What are solicitors looking for when they review bank statements?
There are many reasons that bank statements are a key part of disclosure during the divorce process. When reviewing these statements, a solicitor is generally looking for:
- Evidence that the expenditure matches that which has been declared on the Form E
- Transfers to other bank accounts that don’t appear on the Form E
- Large payments out of the account that cannot be explained. These may also suggest that money is being deliberately transferred to another party to exclude it from the divorce settlement
- Large payments, which do not seem to come from sources detailed on the Form E. Are these bonuses or commissions? Or dividends from non-disclosed investments?
If these statements highlight any suspicious activity, a solicitor may ask for further evidence or request additional bank statements.
Along with bank statements, what other documents will I have to provide?
As we have seen, you are required to provide 12 months’ bank statements for every account you hold.
In addition to these statements, there may be other documents you have to provide as part of the financial disclosure process. These include:
- Details of any property you own, including a valuation that is no more than six months old (if you have one). If you don’t, you may have to provide market value estimates from several estate agents
- A recent mortgage statement for any property on which you have a mortgage
- A valuation of your pension. This is typically a Cash Equivalent Transfer Value (CETV) figure, dated within the last 12 months. If you do not have such a valuation you will need to obtain one in good time as this can take weeks or months to be produced by your pension provider
- Proof of income. This will be your last three wage slips and your most recent P60 if you are employed. If you are self-employed you will have to supply a copy of your tax returns for each of the last two years
- Business accounts. If you are a sole trader, partner or a shareholder in a business you will have to provide accounts for the last two years.
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