Separating from your partner can be stressful, emotional and complicated – especially if you have assets and liabilities that need to be dealt with.
Many couples find themselves in a position where they need to divide their assets before they can officially move on with their lives. Hence, dividing assets in divorces or de facto separations is an issue that is both necessary and of paramount importance. Need help with your division of property following a relationship breakdown? Get in touch with our experienced family lawyers.
How are assets divided in a divorce in Australia?
When dividing assets in a divorce, the court will do so in accordance with the Family Law Act 1975. While there is no set formula in how assets of a marriage are divided, the court will consider several different variables, including:
- The individual properties and values owned by each person prior to the marriage
- The contributions of each spouse during the course of the marriage
- The assessed value of each joint property investment
- The monetary earnings of the parties
- The non-monetary contributions of the parties; including those made by a stay-at-home parent
- The future needs of the parties based upon age, health, monetary resource, parental contributions, employment viability within the workforce, other financial resources and child care.
Are assets always split 50/50 in a divorce?
Not necessarily, no. There is no automatic formula for dividing assets in divorce. So, while it is often believed that there is a standard property settlement percentage split, this is not true. Instead the court will look at several factors to fairly divide the property. If you have any questions about this, please don’t hesitate to speak to our property settlement lawyers.
What assets are considered?
When dividing assets in divorce, the following assets will be considered:
- Bank accounts (including savings accounts and cash)
- Credit cards
- Retirement funds
- Real estate (property)
- Joint and separate business interests
- Superannuation (learn more: splitting superannuation after separation)
- Debts (mortgages, loans, personal debts)
What assets cannot be split in a divorce?
The following assets cannot be split between divorcing parties:
- Inheritance – depending upon the point at which the inheritance was received and if the inheritance was intended as a joint gift or a separate bequest
- Premarital assets – those owned prior to the marriage and kept separate from the marital asset pool
Whether you need help splitting assets in a divorce in Australia or a de facto relationship separation, you can turn to Owen Hodge. Our lawyers will handle your matter with integrity, professionalism and care. Call our team on 1800 770 780 to schedule an initial consultation.
Dividing assets in divorce FAQ
Does length of marriage affect divorce settlement?
The length of the marriage can affect a divorce settlement. In cases where the marriage is of a shorter duration, the court is more likely to ignore the financial contributions that each person entered the marriage with.
Therefore, if your marriage has lasted less than five years, the court may exclude, or give less consideration, to each person’s initial contribution to the marriage, thereby not considering it as part of the asset pool.
What is a fair settlement in divorce?
A fair divorce settlement will be different for each couple. It is highly likely that if the distribution of the assets is left to the court’s discretion, the outcome may not be agreeable to both parties.
Hence, for the outcome to be considered ‘fair’ for everyone involved, it is always best for a divorcing couple to cooperate and compromise amongst themselves and their respective divorce lawyers when it comes to dividing assets in divorce.
Can I empty my bank account before divorce?
Any unilateral action taken to change or hide assets is not recommended. Instead, if you have concerns that your joint funds might be excessively depleted before the proceedings conclude, it is best to seek advice from your family lawyer before taking any action to move or protect the funds on your own.
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