Tag: Family Law Firm

Generally speaking, inheritances are not excluded or otherwise quarantined from the asset pool to be divided between separating parties, and will not automatically be allocated back to the party who received them.

Some of the relevant factors the Court takes into account are as follows:

Timing and length of a relationship

For example, an inheritance received very early in a long relationship might not result in a significantly higher contributions assessment to the party who received it, because the other party might have made other contributions over the years which offset the effect of the inheritance.

An inheritance received late in the relationship or after separation in a short relationship, is more likely to result in a higher contribution assessment to the party who received it.

Amount received

The amount received – and compared with the asset pool to divide – will affect the Court’s ultimate decision.

For example, a smaller amount (say $20,000 inheritance in a pool of $1.5m) is less likely to result in contributions being assessed in favor of the party who received it than a larger amount (say $1m in a pool of $1.5m).

How it was applied

If the money was used for family holidays or otherwise spent and is no longer represented in the asset pool, it will carry less weight when assessing contributions than if it was used to purchase real estate or shares and those assets still exist at the time the Court is making a determination. It may also be relevant if the funds have been kept separate and not otherwise mingled with the parties’ assets.

Financial circumstances of the parties at the time the Court makes a decision

In a pool of $1m, where one party receives a post-separation inheritance of $500,000, it might not be just and equitable for one party to receive half of the net assets ($500,000) and the other to receive the other half plus the whole inheritance ($500,000 plus $500,000). The Court will consider the whole financial situation.

Inheritances received after separation

If one party receives an inheritance after separation but before property settlement has been agreed and formalized, the inheritance will be taken into account in the property settlement as the Court must consider all of the current financial circumstances at the time the determination is being made.

This is one of the reasons why it is recommended that separating parties finalize and formalize their property settlement as soon as possible.

This does not necessarily mean that the other party will receive a portion of the inheritance. The Court might determine that the other party made no contribution to the inheritance, but it will be taken into account and adjustments might be made in favor of the other party who does not receive the inheritance.

Future inheritances

A future inheritance will usually only be taken into account if the death of the testator is imminent.

As the inheritance has not yet been received, the Court could not include it in the asset pool but can take it into account in assessing the respective future needs of the parties.

How can an inheritance be protected against claims by the other party?

Parties to a marriage or de facto relationship can protect future inheritances by entering into a Binding Financial Agreement which sets out how any inheritance would be dealt with in the event of separation.

If parties have separated and there is a possibility that one party will receive an inheritance in the future, it is recommended that they finalize their property settlement as soon as possible, and before the death of the testator.

Specialist Family Law advice regarding family law property is essential. Let your client know about our free initial telephone consultation service by calling Vanessa Mathews on 9804 7991 to book an appointment with one of our specialist solicitors.

We’re operating as usual at Mathews Family Law. If you have any questions or concerns about how COVID-19 may impact your client’s position in relation to their family law matter, call Vanessa Mathews on 9804 7991 or email [email protected].

A CURLY CASE FOR THE COMMISSIONER OF TAXATION

CAO & TRONG AND ANOR [2018] FAMILY COURT OF AUSTRALIA

There is no escaping the Family Court and the Commissioner …

The wife filed an application for a final property settlement, including an order that:

1. The husband indemnify her ‘against any liability present or contingent including tax … in respect of E Pty Ltd’; and
2. The husband be responsible ‘for all income tax assessed on income received or deemed to have been received by the husband’.

In the period 2005 -2012, the husband incurred a tax liability of $5,519,200 (unpaid).

The Commissioner of Taxation sought leave to intervene in the property settlement proceedings and an order that the court first makes provision for the payment of tax liabilities to the Commissioner prior to any property distribution to the parties.

Before the matter could be determined by the court, the parties effectively withdrew their respective applications for final property settlement orders.

The wife advised the Commissioner that there was therefore now no basis for it to intervene.

The Commissioner was successful in its application for an order that the court does have the jurisdiction and power to determine a claim against a creditor pursuant to section 79 property settlement proceedings – even if the parties have withdrawn their applications.

The case was run by the Commissioner of Taxation as a ‘test case’ and confirmed that even when the parties themselves no longer seek the assistance of the court to achieve a final property settlement, if the Commissioner has already intervened in those proceedings, the court has jurisdiction to make a final order in its favor – and the liabilities owed to it enforced as an order of the Family Court.

In other words – there’s no avoiding the Commissioner – no matter what agreement the parties themselves might ‘agree on, there’s no way around their obligations to it.

I hope that the year is treating you well – even though it is flying by.

We continue to offer a free 15-minute telephone consultation to your clients in need of family law advice – they can call me on 9804 7991 or email [email protected] to book a time.

And remember, we’re always happy to help you out with your own ‘curly cases’.

Stay in touch,

Vanessa and the Team at Mathews Family Law & Mediation Specialists

Mediation (also known as ‘Family Dispute Resolution) is a powerful tool for resolving parenting child custody and property settlement asset division disputes following separation and divorce, with a greater sense of satisfaction and ownership by the parties of the resulting agreement.

You may be feeling uncertain about whether or not FDR / mediation is ‘appropriate’ for you.

The answer to this question may or may not be obvious, for example:

1. FDR / mediation will be obviously not appropriate if a party refuses an invitation to attend an initial intake meeting with an FDRP / mediator –all FDR / mediations commence with an initial intake session, including risk assessment. The decision to participate in FDR / mediation must be voluntary and cannot be ‘imposed’.
2.  FDR / mediation may be appropriate even if a party expresses concern about a power imbalance and their capacity to participate – alternative modes of FDR / mediation will be considered at the initial intake meeting, including the options of joint sessions, shuttle mediation, remote attendance via skype/telephone/email. The availability of alternative modes enhances access to FDR / mediation.
3. FDR / mediation will be appropriate if both parties consent to attend – a choice of mode of attendance ensures that parties wishing for a non-litigious approach have the opportunity to utilize FDR / mediation notwithstanding concern about doing so.

For more than a decade Vanessa Mathews, accredited family law specialist and accredited FDRP and Mediator, has been providing FDR / mediation services in conjunction with her work as a family lawyer in Melbourne’s eastern suburbs. During this time Vanessa has provided FDR / mediation to hundreds of clients. Whilst there will always be the need for the Family Court to resolve the most complex parenting child custody and property settlement asset division matters, Vanessa continues to be in awe of, and humbled by, clients who choose to take responsibility for their parenting child custody and property settlement asset division and spousal maintenance issues via FDR / mediation – rather than have a Family Court Judge do this for them.

Vanessa is available to assist you to achieve a mediated agreement to:

1. Resolve your parenting issues including:

1. Interim issues:
   i. Child custody following separation, eg shared care
   ii. Single issue disputes, eg choice of school
2. Final issues:
   i. Child custody when one parent wishes to relocate with the children
   ii. Ongoing parenting child custody arrangements
3. Documentation of agreements
   i. Parenting Plan
   ii. Family Court Consent Orders

2. Negotiate property settlement and spousal maintenance issues including:

1. Interim issues:
   i. The use or sale of the home following separation
   ii. Child support
   iii. Spousal maintenance
   iv. Disclosure and valuation of assets
2. Final issues
   i. Property settlement asset division
   ii. Child support
   iii. Spousal maintenance
   iv. Superannuation splitting
3. Finalization of the agreement:
   i. Family Court Consent Orders
   ii. Binding Financial Agreements

Please contact Mathews Family Law & Mediation Specialists on 1300 635 529 to discuss your FDR / mediation needs.

Mathews Family Law & Mediation Specialists offer fixed fees for FDR / Mediation.

In 2019:

• Vanessa Mathews and Mathews Family Law & Mediation Specialists are rated by ‘Three Best Rated’ as one of the three best divorce lawyers in Melbourne.
• Vanessa Mathews is recognized by Doyle’s Guide to the Legal Professional as a ‘Recommended Family Lawyer’ and ‘Recommended Family Law Mediator’ in Melbourne.
• Mathews Family Law & Mediation Specialists won the Global Law Experts Awards for ‘Best Family Law Firm Australia’ and ‘Best Family Law Mediator Australia’ awards.
• Mathews Family Law & Mediation Specialists is a family law firm in the eastern suburbs of Melbourne – Suite 10/1 Grattan Street, Prahran VIC 3181.

The Importance of Negotiating a Family Law Settlement

The importance of meaningful settlement negotiations in family law cannot be overstated.

While every separating couple has their own unique circumstances, one principle remains consistent: a genuine attempt to resolve disputes early can save significant time, stress and legal costs.

A recent Family Court decision highlights the risks of allowing conflict and emotion to prevent reasonable settlement discussions.

In that matter, the Court ordered the wife to pay the husband $30,000 in legal costs after finding that she had failed to make a meaningful attempt to negotiate a resolution. The Court considered that her approach to the litigation had been influenced by anger and distress, and that she had rejected a settlement offer that ultimately exceeded the outcome she received at trial.

The result was significant:

• The settlement outcome was less favourable than the offer that had been rejected; and
• A substantial costs order was made against her.

The Lesson: Settlement Requires Strategy

Family law disputes are understandably emotional. Separation often involves feelings of disappointment, hurt, uncertainty and frustration.

However, successful family law outcomes require careful decision-making and a focus on practical solutions.

A well-considered negotiation strategy can help you:

✔ Reduce legal costs
✔ Minimise stress and conflict
✔ Maintain greater control over the outcome
✔ Avoid the uncertainty of a Court determination
✔ Reach a resolution sooner

This does not mean accepting an unfair outcome. It means obtaining specialist legal advice, understanding your legal position and approaching negotiations with a clear strategy.

The Benefits of Mediation and Negotiation

At Mathews Family Law & Mediation Specialists, we believe that many family law disputes can be resolved effectively through negotiation and mediation.

Our Accredited Family Law Specialists and mediators assist clients to:

• Understand their legal rights and options
• Evaluate settlement proposals
• Negotiate strategically
• Identify practical solutions
• Resolve disputes without unnecessary Court proceedings wherever possible

Where Court proceedings are necessary, we continue to focus on achieving the best possible outcome while exploring opportunities for settlement throughout the process.

Resolve Your Family Law Matter with Experienced Guidance

If you are facing a property settlement, parenting dispute or other family law matter, early advice can make a significant difference.

Contact Vanessa Mathews, Accredited Family Law Specialist and Mediator, to discuss your options.

Call 1300 635 529 or email [email protected] to arrange a consultation.

About Vanessa Mathews — Accredited Family Law Specialist

Vanessa Mathews
Principal | Accredited Family Law Specialist | Accredited Family Dispute Resolution Practitioner | Mediator

This page was prepared and reviewed by Vanessa Mathews, Principal of Mathews Family Law & Mediation Specialists. Vanessa practises exclusively in family law and assists clients throughout Australia with separation, divorce, parenting disputes, property settlements, financial agreements and other complex family law matters.

Helping families resolve conflict through specialist legal expertise and constructive dispute resolution.

Last reviewed: 24 July 2026

Disclaimer: This page provides general information only and does not constitute legal advice. Every family law matter is different and you should obtain advice tailored to your circumstances.

Inheritance – What Happens to Them In Divorce Property Settlement

An article was written for accountants and financial advisors by Vanessa Mathews of Mathews Family Law & Mediation Specialists.

Your client has the good fortune to receive a ‘windfall’, such as an inheritance or a lotto. Your client and their partner separate.

Will the windfall be included in the property settlement asset pool?

Your client will likely answer ‘No Way’!

From the court’s perspective, windfalls are not a special category of contributions and they must be:

1. Included in the asset pool.
2. Considered in the same manner as, and holistically with, all of the other contributions made during the relationship – financial, non-financial, homemaker and parenting.

The timing of the windfall will however be relevant as to how the windfall is ‘shared’:

• A windfall received early in the relationship is likely to be treated equally.
• A windfall received shortly before separation is less likely to be treated equally.
• A windfall received after separation is even less likely to be treated equally.

The short answer is that the windfall is unlikely to be retained in full by your client.

I’ll leave it to you to break the bad news to them.

Next Steps Before a Divorce Property Settlement

You and/or your client may benefit from discussing the circumstances of the inheritance or other windfall and divorce property settlement before taking any action such as distributing or disposing of the asset in a manner that may adversely impact your client.

Vanessa Mathews is a family law specialist solicitor with the expertise and experience to advise you about your family law property settlement issues.

Please call Mathews Family Law & Mediation Specialists on 03 9804 7991 or email [email protected] to speak with Vanessa Mathews or one of our other family law attorneys regarding any family law property matters.

Resources

Mathews Family Law – Dividing the Property: https://mathewsfamilylaw.com.au/divorce/divorce-videos/dividing-the-property-in-victoria/

Family Court of Australia: http://www.familycourt.gov.au/wps/wcm/connect/fcoaweb/home

Federal Circuit Court of Australia: http://www.federalcircuitcourt.gov.au/wps/wcm/connect/fccweb/home

Sharing Family Law Expertise with Professional Advisers

The team at Mathews Family Law & Mediation Specialists has enjoyed the opportunity to present family law seminars to CPA and IPA accountant discussion groups.

We value the opportunity to collaborate with other professionals who play an important role in supporting clients through separation, divorce and significant financial transitions.

Accountants are often among the first professional advisers to become aware of a client’s changing family circumstances. Understanding the financial and legal considerations arising from relationship breakdown is essential when providing effective guidance and support.

Key Family Law Issues Affecting Clients

Our presentations explored a range of practical family law issues, including:

• The financial consequences of separation and divorce
• Property settlements and division of assets
• Business and trust considerations in family law matters
• Superannuation and financial resources
• Tax considerations arising from relationship breakdown
• The importance of early legal advice
• Negotiation, mediation and dispute resolution options

The discussions are engaging and interactive, with many questions, scenarios and practical examples explored throughout the sessions.

Supporting Professional Networks

At Mathews Family Law & Mediation Specialists, we believe collaboration between professional advisers is essential to achieving the best outcomes for clients.

By working alongside accountants, financial advisers and other trusted professionals, we help ensure clients receive coordinated advice during what is often one of the most challenging periods of their lives.

We thank the CPA and IPA accountant groups for inviting us to share our knowledge and for the thoughtful discussions and questions raised during the seminars.

Professional Family Law Advice in Melbourne

If you are an accountant or professional adviser seeking family law insights for your clients, or if you require specialist advice regarding a separation or divorce matter, our team welcomes the opportunity to assist.

Mathews Family Law & Mediation Specialists provides expert advice in:

• Divorce and separation
• Property settlements
• Financial agreements
• Parenting matters
• Mediation and dispute resolution
• Complex financial family law matters

Contact our team to discuss how we can assist you or your clients.

To follow is a summary of the ‘pathway’ to be taken by the single expert witness in family law parenting proceedings.

It provides a useful reminder of the Family Court’s expectations of the single expert witness.

• ‘ … The task of a single expert witness is never easy. The opportunities for observation and consultation are rarely if ever entirely satisfactory, because of constraints of time and money. Usually, each party is seeking some corroboration from a single expert witness of his or her position.
• Although the expert may give evidence about the “ultimate issue”[67], more frequently the determination of that matter will fall to the Trial Judge. Each party and the Judge may confront the single expert witness with hypothetical sets of facts to see if the expert will or could modify or qualify his or her opinion. Frequently, with a necessarily limited database, a single expert witness faces challenges to his or her opinion.
  It is important therefore that single expert witnesses follow the pathway prescribed by authority[68] to prepare and present or their report.
• The pathway accords with common sense. First, the expert must have primary and particular qualifications and experience. For example, expert evidence on the health of children should come not only from a medical doctor but desirably from one who specialized in child medicine and moreover someone experienced in such an area of practice and knowledge.
• Second, the expert should clearly indicate the information and facts upon which he or she has relied and identify the assumptions upon which he or she proceeded.
• To the extent that the expert relies on research to form his or her opinion, it may be wise to identify that research, particularly if it is likely to be controversial and invite cross-examination. An expert becomes an expert through knowledge of and reliance upon, research other than his or her own and the expert’s opinion must necessarily be a synthesis of knowledge in the field of expertise. However, comments such as “research shows” may indicate a lack of specialist acuity.
• Third, the pathway of reasoning to the opinion must be discernible. This would seem to be a statement of the obvious but surprisingly from time to time it is overlooked by a single expert witness …’.

As reported in Hoffman & Barone [2014] FamCA 52 (4 February 2014), Deputy Chief Justice Faulks, paragraphs 93-100 (inclusive).

In 2006 it became mandatory for all couples to attend family dispute resolution prior to filing an application with the court to determine custody. One of the aims of this legislation was to encourage parents to reach an agreement about parenting on their own terms, without the interference of the courts. After family dispute resolution is attempted, the practitioner involved in the process issues one of four types of certificates:

1. A person did not attend family dispute resolution with another party because of the other party’s refusal or failure to do so;
2. A person did not attend family dispute resolution because the practitioner considered that it would not be appropriate to conduct such resolution (having regard to matters prescribed by the regulations);
3. A person did attend family dispute resolution and all attendees made a genuine effort to resolve the issue or issues;
4. A person did attend family dispute resolution but the person or another party did not make a genuine effort to resolve the issue or issues

The court will consider these certificates prior to making a ruling in the case, and can also consider the certificates when assessing whether to order costs to be paid by a party.

Does that mean that you absolutely have to attend family dispute resolution and get one of these certificates before you can file a custody action?

Not exactly.

While the legislators voiced a clear preference for settling child-related matters through family dispute resolution, they also recognized six classes of cases in which family dispute resolution should not be required.

1. Application for Consent Order Pending

If parties are applying for a consent order, then they have already reached an agreement on how to handle child-related issues. Therefore, ordering the parties to attend family dispute resolution prior to filing an application for the consent order would be futile.

2. Violence and Abuse

Where the court finds reasonable grounds exist that demonstrate that there has been abuse or family violence, or that a risk of such exists, no compulsory family dispute resolution is required. The court will not force parties to attempt to achieve a resolution to their child-related issues if there is any history or threat of violence.

3. Contravention of Previous Order

A party can make an application to the court regarding a “particular” child-related issue, without attending dispute resolution, if there is already an order in place addressing said issue. For instance, if there is already an order in place setting forth a custodial schedule for the child, and one party is not abiding by the order, the complying party may apply directly to the court to seek enforcement of the order. If there is already an order in place, there is no need to utilize dispute resolution services to try and reach an agreement.

4. Application is Urgent

Sometimes a parent will have to make an urgent application to the court about a child-related issue. An example of this would be if a parent intended to relocate and take the child with them, in a situation like that the parties would need to have the issue addressed by the judge as soon as possible, spending time at family dispute resolution would simply slow the process down.

5. Incapacity

If a party lacks the capacity, physically or otherwise to attend family dispute resolution, the court will not enforce their attendance. For instance, if a party is unable to participate effectively because they live in another country, an application regarding a child-related issue could be made directly to the court even if no family dispute resolution has taken place. The rationale for this exception is that compelling attendance would be largely inconvenient; a party could make sacrifices to travel and attend dispute resolution only to not reach an agreement and have to subsequently travel again for litigation.

6. Other Circumstances

The final exception category is a catchall. If there is another reason set forth in the regulations that would allow parties to bypass family dispute resolution, that reason will suffice and allow parties to bypass compulsory dispute resolution.

The bottom line is unless your situation qualifies for one of these enumerated exceptions, you should be prepared to attend family dispute resolution prior to making an application to the court to determine custody or other child-related issues.

The short answer is no – what is discussed in family dispute resolution may not be used against you in court.

First, what is said during this process is protected by rules regarding confidentiality. Statements that you offer to a family dispute resolution practitioner, or to your lawyer in front of a family dispute resolution practitioner are protected. Such a practitioner can only disclose statements made during a previous family dispute resolution session in a limited number of circumstances. For instance, if the practitioner reasonably believes disclosure is necessary to protect a child from harm or to report or prevent damage to property they may disclose statements indicating such.

While rules of confidentiality are implicated, you should also know statements made in a family dispute resolution are also inadmissible in court proceedings. While there are a few narrow exceptions to this rule, you should be aware that statements made during a dispute resolution session are generally not admissible in court.

In custody disputes, one of the issues parents often disagree over is which parent will decide the major long-term issues; such as where the child will attend school, what the child will be named, and the religion and cultural upbringing the child will experience. Generally speaking, the parent who physically has the child in their custody will decide the day-to-day decisions, but what about these bigger and more impactful decisions?

What is a major long-term issue?

First, we should take a look at what exactly constitutes a major long-term issue. The Family Law Act defines that these issues are those about the long-term care, welfare and development of the child and includes (but is not limited to) issues of that nature about:

• education (both current and future);
• religious and cultural upbringing;
• health
• the child’s name and
• changes to the child’s living arrangements that make it significantly more difficult for the child to spend time with a parent

Some issues might not be major long-term issues on their face, but the results of the decision impact the child and thus make it a major long-term issue. An example of this is would be when a parent starts a new relationship. This by itself would not be considered a major long-term issue, however if it results in the parent moving further away from the child it becomes one.

Generally, decisions about what the child wears, what time the child goes to bed, and what the child eats are not considered major long-term decisions. These decisions are typically made by whichever parent has the child in their custody. For instance, the father may decide while the child is in his care he will go to bed at 8:00, and the mother may decide that 7:30 is an appropriate bedtime. These decisions do not impact the long-term welfare of the child and are not typically disputed.

However, sometimes an issue that appears to be a day-to-day decision is actually a major long-term decision. This may be the case where the parents have differing views about the religious or cultural upbringing of the child. One parent may not want the child to eat certain foods or receive certain medical treatment because of religious practice, while the other parent may not follow the same practice. In this situation, the decision about what food the child will eat has become a major long-term decision and will be treated as such by the court.

Who makes the major long-term decisions?

If you have read our other articles about custody, you have noticed a trend. The law in Australia strongly prefers for parents to reach amicable decisions regarding custody without using the courts, and also for parents to share parental responsibility for the child. So, it may not come as a surprise that when it comes to making major long-term decisions, the decisions should be made jointly. This isn’t merely a preference; the Family Law Act actually imposes an obligation on parents to make a genuine attempt to reach a joint decision. Only if you are unable to do so, after attending dispute resolution, may you apply to the court for an order addressing the conflict.

Rules about specific major long-term issues

Changing the child’s name. If you wish to change your child’s name, each person with parental responsibility for the child will have to agree. If you are unable to get the other parent on board with the proposed name change, you may make an application to the court, and the court will make the decision while considering the welfare of the child. In determining if the proposed name change should be made, the court will look at several factors, including both the short and long-term effects, embarrassment expected on behalf of the child, identity confusion of the child, and the effect the change will have on the relationship between the child and other parents. Before you may apply to the court for a name change, however, the Family Law Act requires the parties to attend dispute resolution in an attempt to resolve the issue.

Relocation. Relocation is one of the most common major long-term issues that parents tend to disagree over. After enduring a separation or divorce it is not unusual for one parent to want to relocate. The parent may wish to relocate because of an employment opportunity, because of a new relationship, to be closer to family, or simply to make a fresh start. However, if the parent wishes to relocate the child as well, often the non-moving party will object. This is obviously a difficult subject and one that is emotional for all parties, including the child. Unfortunately, there is no guiding provision in the Family Law Act and no case that carves out a definitive rule regarding this issue. The courts have consistently determined that the same guiding principle applies to relocation cases as to other major long-term causes, and that principle is to make a decision that is in the best interest of the child.

When it comes to settling disputes about major long-term issues, each situation is different and has its own unique circumstances. It is always best to try and reach an agreement without involving the courts, however if this is impossible, you may apply to the court for an order resolving the dispute. The court will always act under the principle that the best interest of the child is of paramount importance, and this is the same guiding force you should adopt in your attempt at reaching an agreement.

When a couple separates or divorces, or a de facto relationship[i] ends, a property must be divided. The property includes all of the assets – houses, cars, jewelry, furniture – and all of the liabilities, like loans and mortgages.  Superannuation – the money individuals set aside to have when they retire – is now also included in those assets that need to be divided fairly between a couple, whether married, de facto heterosexual or de facto same sex.  In the past, superannuation was considered a financial resource, similar to salary or other income. Today, however, most couples weigh superannuation funds as if they are marital assets or property.

Part VIIIB of the Family Law Act, 1975 (FLA) covers issues dealing with superannuation and families. The law requires that the superannuation benefits due to one spouse or de facto partner must be divided with the other spouse or partner. But there are several difficulties with dividing superannuation. Firstly, if a couple divorces before retirement, the superannuation funds are not yet available. So while a couple may divide up their property at the age of 45, they may not see funds from superannuation for another 20 or 30 years.  Other problems…..

The law recognizes these problems and offers three ways a divorcing couple can divide superannuation interests.

1. “Split”.  The first method is to split the interest into two accounts or benefits. This can be done either by a payment split when the superannuation becomes due (say, at retirement) or through an interesting split, which means each partner receives a superannuation interest. With an interesting split, the partner receiving the new benefit can keep the money in the original account until it comes due, or open an entirely new account. Nobody receives an actual cash payment – the money remains in a superannuation fund.  Tax issues must be calculated before the payment or interest is split.
2. “Flag”.  The second approach to dividing superannuation is to flag the benefit for a later date. In this scenario, the couple marks the benefit and the trustee of the superannuation fund is not allowed to touch it until the “flag” is lifted, either by agreement of the parties or with a court order.  The couple can then decide what happens to the fund only later after the person who owns the superannuation account retires.
3. Leave it alone.  In this case, couples consider superannuation a financial resource. When dividing up their assets, superannuation is only included in the calculation as a source of income, not as an asset.

Splitting the Superannuation Now

Typically, divorcing couples split their superannuation. Most couples choose this approach because it enables them to know exactly how much money they are receiving and allows them to make a clean break, without having to return to financial issues ten, twenty or thirty years later.

There are several steps needed to split the superannuation:

Step 1:  Request information from the partner’s superannuation fund.  

 There are two forms that a spouse must submit to the trustee of the superannuation fund:

1. Form 6 Declaration, which proves to the trustee that you are entitled to see the information and
2. the Superannuation Information Request Form. These forms can be obtained online

You must be “eligible” to receive the information from the fund.  An eligible person is:

1. The member of the fund or
2. The spouse of the member of the fund or
3. If (1) or (2) died, the deceased person’s legal representative or
4. Someone who plans to enter into a superannuation agreement with the member

Step 2: Evaluating information from the superannuation fund.  

The law requires the fund to provide information to the member of the fund and his or her spouse. The fund may provide information regarding the value of the superannuation or information that helps the person requesting information determine the value of the fund. The trustee should also notify the requester whether or not the fund may be split.  Once this information is obtained, the numbers must be calculated using specific formulas, depending on the type of fund. An expert in family law or accounting can help determine the correct formula to use in order to obtain the correct amount of interest each party is entitled to from the superannuation.

Step 3:  Turn to the courts for an order.   

Couples may sign their own splitting agreement and take it directly to the trustee of the superannuation fund. Alternatively, couples can turn to the courts with their own financial agreement already signed. Finally, if a couple can’t agree, they may obtain a court order.

1. If both sides agree about the value of the fund and it’s division, they can submit an Application for Consent Orders, which includes their agreement regarding superannuation. This agreement is binding only if both parties signed it AND both received independent legal advice.  This is the case regarding all financial agreements between couples divorcing.
   

   De facto couples terminating their relationship may also submit a financial agreement regarding superannuation, but only if they were residents of New South Wales, Victoria, Queensland, South Australia, Tasmania, the Australian Capital Territory, the Northern Territory or Norfolk Island when the agreement was made.

2. If the parties cannot come to their own agreement, they may turn to the court for Orders.

In either case, the trustee of the fund must be notified that the court is being asked to give orders. This is to ensure that the request being made complies with the fund’s rules. Also, the trustee is entitled to attend the court hearing and oppose the orders.

Step 4: Send a copy of the agreement or court order to the superfund trustee. 

Once the court gives orders, the superannuation fund must be sent a sealed copy of the decision.

Step 5: Split the superannuation benefit. 

Generally, the superannuation benefit will be split into two funds, one for each partner. There may be administrative costs for splitting the fund.

Contact Mathews Family Law to speak with one of our specialist solicitors and family law property lawyers to discuss your superannuation split today. Call our office on 03 9804 7991 and book a consultation with a divorce and family law attorney.

[i] Laws on the splitting of superannuation do not apply to de facto couples from Western Australia.