Олександр Сич
July 27, 2026
Short answer. A business established or acquired during the marriage is subject to division; however, it is not the business itself that is divided, but its value, a share in it, or the income it generates. Income from a sole trader’s business earned during the marriage is considered joint property of the spouses (Articles 60 and 61 of the Family Code); however, it is the net profit that is divided — taxes, duties and operating expenses are deducted from the income (Supreme Court ruling of 2025). The assets of a limited liability company (LLC) belong to the company itself, not to the spouses; therefore, a share in the company is usually divided by means of monetary compensation. A business acquired before marriage or through inheritance is not subject to division.
When a married couple who own a business divorce, the division becomes significantly more complicated. Family, corporate and tax law all intertwine here, and the cost of a mistake can be control over the company or substantial sums of money. There are many myths surrounding this topic: from ‘the business will be split down the middle’ to ‘my wife has nothing to do with my sole trader business’. The reality is more complex and depends on the form of the business. Let’s examine exactly what is divided in the case of a sole trader business, a share in a limited liability company (LLC) and corporate rights, and how the amount to be divided is calculated.
Is a business subject to division in a divorce?
The general principle is the same as for other property: everything acquired during the marriage is the joint property of the spouses (Article 60 of the Family Code). This also applies to a business — provided it was established or acquired during the marriage. It does not matter which spouse the sole trader business is registered in the name of or which spouse holds a share in the company: the presumption of joint ownership applies by default.
A business acquired prior to the marriage, or received by one of the spouses through inheritance or a gift agreement, is not subject to division (Article 57 of the Family Code). However, this presumption can be rebutted by either party: the party claiming that the business is personal must prove this by providing documents regarding the origin of the funds or the date of acquisition.
How a sole trader’s business is divided: income is divided, not the ‘sole trader’
A sole trader is not a separate company, but rather the status of a natural person. Therefore, it is not possible to ‘divide a sole trader’ in the literal sense. What is divided is the income from business activities earned during the marriage, as well as assets acquired for the business using joint funds (equipment, stock, vehicles).
The Supreme Court has confirmed that the presumption of joint ownership applies to the income of an individual entrepreneur derived from business activities during the marriage (pursuant to Articles 60 and 61 of the Family Code). However, there is a critically important nuance regarding exactly which amount is divided.
It is the net profit that is divided, not the turnover
This is a key point that is often misunderstood. It is not the sole trader’s entire income (turnover) that is divided, but the profit. In its ruling of 8 October 2025 in case No. 545/725/18, the Supreme Court emphasised that, in order to calculate profit, taxes, duties, production costs and the costs of purchasing goods and services must be deducted from the income — and only the remaining amount may be subject to division. In other words, the actual net profit for the period of the marriage is first determined, and only then is it divided between the spouses.
Another important conclusion from case law is that the income of a sole trader which has already been spent in the interests of the family during the marriage cannot be the subject of a separate division. If the funds were used for the family’s needs, they are not divided a second time.
How are shares in a limited liability company (LLC) and corporate rights divided?
The situation with a limited liability company is more complex, and this is where a common misconception lies. Assets belonging to an LLC (the company’s property, equipment, funds in the company’s accounts) are the property of the legal entity itself, not the spouses. Therefore, the other spouse cannot claim the company’s assets directly and does not automatically become a shareholder in the limited liability company.
What, then, is divided? The value of the share (corporate rights) in the authorised capital, provided that this share was acquired during the marriage. In practice, this is usually achieved through financial compensation: one spouse retains the share and control of the business, whilst the other receives funds equivalent to half the value of the share. This is precisely why the division of a business is rarely literally ‘half and half’ and almost always requires a separate legal strategy and valuation.
How much is a share worth: a valuation is required
To determine the amount of compensation, a valuation of the business or share is carried out, taking into account assets, liabilities (debts), profitability and market value. For sole traders, the calculation is based on tax returns and documents detailing income and expenditure during the marriage, taking into account the chosen tax regime. Without a thorough valuation and analysis of the accounts, it is impossible to determine a fair amount; therefore, such cases almost always involve a financial expert assessment.
What evidence is required for the division of a business
The burden of proof regarding the size of the share lies with the party claiming it. The following will be required:
- the sole trader’s tax returns or the company’s financial statements for the period of the marriage;
- calculations of income received and expenses incurred;
- bank account statements;
- information on the taxation regime;
- constitutive documents, an extract from the register regarding the share in the limited liability company;
- an independent valuation report on the value of the business or share.
If one spouse attempts to conceal income, transfer assets or understate the value of the business in the run-up to the divorce, the court may take such actions into account to their disadvantage.
Methods of dividing a business
In practice, three approaches are used. The first is monetary compensation: the business remains with one spouse, whilst the other receives funds for their share; this is the most common option, which keeps the company operational. The second is the sale of the business or asset, followed by the division of the proceeds; this is appropriate when neither spouse wishes to or is able to run the business independently. The third is to set out the business arrangements in advance in a marriage contract or to divide the assets by mutual agreement; this is the least contentious route.
How to protect your business in advance
The most reliable protection is put in place before a conflict arises. Practical tools: a prenuptial agreement stipulating that the business or income from it is the personal property of one spouse; clear bookkeeping that distinguishes between personal and family expenses; and retaining documents proving the source of the start-up capital (personal funds, inheritance, sale of pre-marital property). Such steps significantly reduce the risk of losing part of the business in the event of a divorce.
Questions and answers
Is my spouse entitled to my sole trader business?
Not to the sole trader status itself, but to the income from business activities earned during the marriage and to business assets purchased with joint funds — yes. Net profit is shared.
Is the sole trader’s entire income divided, or just the profit?
Only the profit. Taxes, duties and business expenses are deducted from the income, and only the remaining amount is divided between the spouses (Supreme Court ruling of 2025).
Can my wife become a co-owner of my limited liability company (LLC) after a divorce?
Not automatically. The assets of a limited liability company belong to the company. The value of the share acquired during the marriage is divided, usually through financial compensation.
Is a business established before the marriage divided?
No, it is personal property. However, the profit derived from it during the marriage may, under certain conditions, be considered joint property.
How is the value of a business assessed for the purposes of division?
Through an independent valuation taking into account assets, liabilities, profitability and market value; for sole traders, on the basis of tax returns for the period of the marriage.
What should you do if your husband is concealing business income?
Gather circumstantial evidence (assets, expenses, standard of living) and seek financial expertise. The court may take attempts to conceal income into account against that party.
Is it possible to divide a business without going to court?
Yes, through a property division agreement or a notarised prenuptial agreement. This is quicker and keeps the business running.
How can you protect a business from being divided in a divorce?
Enter into a prenuptial agreement, keep clear accounts and retain evidence of the personal origin of the start-up capital.
Sources
- Family Code of Ukraine, Articles 57, 60, 61 — zakon.rada.gov.ua
- Supreme Court case law on the division of sole trader income (Case No. 545/725/18 of 08.10.2025; Case No. 359/10855/19)
- Law of Ukraine ‘On Limited Liability and Additional Liability Companies’
Business division with the lawyers at ‘Svarog’
Business division lies at the intersection of family, corporate and tax law, where control over the company is at stake. The lawyers at ‘Svarog’ will value your share, analyse the accounts, draft a prenuptial agreement, a settlement agreement or a claim, and defend your interests in court — whether you are the business owner or are claiming a share in it. For more details, see the page on property division solicitors, commercial solicitors</ a> and in the family law section.
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