Financial
There's no changing the fact there is one pie to divide between you and your partner. But when you work together with your partner, you can determine how big that pie ends up.
How does the law help determine a "fair" financial split?
The law says that there are four steps to determine a “fair” split of a couple’s assets, debts, superannuation, and resources after they separate. We detail these four steps below.
Because everyone’s financial and life circumstances are different, what other couples do as part of their financial split mightn’t be right for you.
A range of factors influence the appropriateness of a financial split between a couple, and it’s important to know that these factors aren’t all financial.
The 4 Step Process
STEP 1: What is there to divide?
STEP 2: How did each person contribute?
How did you each contribute financially, non-financially, parenting and household chores?
STEP 3: What does the future hold?
STEP 4: Is it overall ‘fair’?
Making your financial separation agreement official
You don’t have to make your financial separation agreement (aka property settlement) official.
If you do want to, there are ONLY two legally recognised ways you can do it.
Binding Financial Agreement
Court approval is not required in order for the agreement to be valid.
Financial Consent Order
A legally binding and enforceable agreement requiring the Court’s approval.
The Court will only approve your agreement if it’s determined to be “fair” in the eyes of the law.
Why make your financial separation agreement official?
Peace of mind
Save money
Get on
No longer feeling financially vulnerable, you can get on with your partner and life without fear of come back. With certainty of terms and clear timeframes, there can be consequences if the agreement isn’t followed.
Split Super
What are the major differences?
Binding Financial Agreement
- Legally recognised
- Legally binding and enforceable
- Capital gains tax rollover relief on transfer of assets
- Legal consequences if not followed
- Stamp duty concessions
- Requires Court approval
- Legal advice required
Parenting Consent Order
- Legally recognised
- Legally binding and enforceable
- Capital gains tax rollover relief on transfer of assets
- Legal consequences if not followed
- Stamp duty concessions
- Requires Court approval
- Legal advice required (advice is optional)
Want to make your financial separation agreement official?
85–100% clear on your financial separation agreement?
Ways to agree
If you and your partner don’t yet have an agreement, there are plenty of ways you can go about reaching a financial separation agreement that does not involve Court.
The Ultimate DIY Financial Split Kit
Talk it out
This is sometimes referred to as ‘kitchen table’ discussions between you and your partner direct.
Private mediation
Child expert help
You and your partner meet with a child psychologist to help you agree
Letters by lawyers
Lawyer mediation
Collaborative family law
Common Questions
You and your partner are under a legal obligation to provide what’s called ‘full and frank financial disclosure’.
It means that you have a duty to one another to disclose all assets (i.e. cash, cars, real estate, shares, crypto and the like), debts and superannuation.
If your partner is unwilling to give you the information you’ve asked for, consider drawing to their attention the Court’s Duty of Disclosure brochure that explains more – CLICK HERE.
If you know the name of your partner’s super fund, then you can apply directly to the superfund for information about your partner’s superannuation balance.
Superannuation is splittable – meaning that you could receive a super split from your partner’s super fund and vice versa.
There is no legal requirement to divide superannuation; you and your partner can agree that you’ll keep your own.
However, if you’re considering not splitting superannuation or you’re interested in a cash-superannuation trade-off, consider getting financial planning advice. Such a decision can impact you significantly in the long term, more than you appreciate right now.
No.
Child support is a separate matter to your property settlement (aka financial separation agreement).
No, there is no legal requirement to make your financial separation agreement official.
There are financial and emotional reasons for doing so though.
If you’re inclined to make your financial separation agreement (aka property settlement) official in a Binding Financial Agreement, then you must engage a lawyer for the required independent legal advice.
You may come across online Binding Financial Agreement templates for a cheap price. But buyer beware. These online templates tend to be riddled with problems and your lawyer may refuse to use that template.
Because the Court is the check and balance as to the “fairness” of a financial separation agreement, legal advice is not required for a Financial Consent Order. In that sense, lawyers are optional.
However, the paperwork involved to make your financial separation agreement official is complicated and difficult. The Court doesn’t make it easy! This is where we come in and can help.
Understanding
the Split
Resources
Sometimes, it feels much easier to be get what you need without having to actually speak to someone
Get plain English, practical information and resources to help you in your separation without breaking the bank.
If you’re unsure on what you need, call our team on (02) 6100 3629.
