Q: I’ve kept a secret bank account from my husband for several years. It has $30,000 in it, mostly from income I earned from a part-time job. Do I need to disclose this when we are declaring our finances for divorce settlement purposes?
—Rita, Barrie, Ont.
A: Having $30,000 in a bank account is good news and means you will have some money handy to deal with the divorce issues at hand. But regardless of whether you and your spouse are writing up a kitchen table agreement or working with professionals, this money must be disclosed.
The rule for separation in Canada is that all assets and liabilities that have been acquired during the time of the marriage are considered to be jointly owned by you and your husband, regardless of who actually earned the money. In simple terms, this means you own 50% of all assets acquired in the marriage, while your husband owns 50%. (There are a few exceptions to this rule, but that is a topic for another day.)
Hiding assets on a sworn financial statement (which is what is required to file a separation agreement) is akin to perjury. If it is found that either one of you has done this, then a motion can be brought before the court and the matter is dealt with by a judge—often settling in favour of the person who didn’t commit perjury. Not only will a settlement be in that person’s favour, but they are also often awarded their legal costs.
While you may have been a disciplined saver, the only viable choice is full disclosure. This means you must disclose this bank account and your savings of $30,000.
—Debbie Hartzman, is a certified divorce financial analyst with Professional Investments in Kingston, Ont.
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