10 Jan Divorce – is a 50/50 property split the standard in Australia?
There is a widely held belief that when a couple separates, they are automatically entitled to a 50% split of all property and assets.
This may seem fair or unfair to you depending on the nature of your relationship, however, the laws in Australia take into account a wide range of factors before deciding on how assets are to be divided, meaning a 50/50 split is never guaranteed.
There’s no ‘one-size-fits-all’ rule
Advice from friends or family is normally given with good intentions and comes often as a result of their own experiences. Unfortunately, this advice is usually misleading and creates false expectations. It is important to realise that one person’s settlement will probably be different from others you may have heard about.
The law sets out a number of things that must be studied to calculate how assets should be distributed after the breakdown of either a marriage or de facto relationship:
1. The total value of the ‘asset pool’. The “pool” will include superannuation entitlements, as well as assets held jointly, personally, in partnership, by trusts, or companies.
2. Whether the parties had assets before the relationship started
3. Whether one or both parties made special contributions during the relationship, such as receiving an inheritance, gift of money or possibly a compensation payment
4. The length of the relationship (how assets are divided in a short relationship may be different from a long relationship
5. Whether there are children from the relationship
6. How much time the children might spend with their respective parents after separation
7. Whether the circumstances of the relationship has affected the income earning capacity of either of the parties
8. Each party’s age and health and the future needs that they may have.
These are a few of the things that are considered by the Family Law Courts and a combination of the above answers will be important when determining how assets are to be divided. Obtaining family law advice early will help parties to know where they stand before negotiating a settlement.