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What counts as property?

If your relationship has ended or is about to end, at some point, you and your former partner will need to divide your property.

Property settlement may be required after a divorce or after separation if you’re in a de facto couple.

Property refers to all assets, liabilities, and financial and non-financial resources that you and your former partner hold, either jointly or in your own names, or assets that are held on your behalf.

Financial resources include any financial support that you receive from another source, for example, Centrelink payments. Non-financial contributions are also included, for example, one parent giving up full-time work to look after children.

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Assets include:

  • Real estate
  • Money in bank accounts
  • Income from your jobs
  • Passive income streams
  • Inheritances
  • Superannuation
  • Business and commercial interests
  • Investments such as shares

Liabilities include:

  • Mortgages
  • Credit card debts
  • Other debts
  • Rent
  • Bills
  • Other expenses such as school fees

How are assets divided after separation?

Your entitlements to the property of the relationship will be worked out using the four-stage test in the Family Law Act.

One of the biggest issues is how to split assets after separation. Australian family laws set out rules for this, which can apply to both married couples, and defacto couples who have lived together for at least two years.

There’s a four-stage test applied to the property of the relationship, including any property that the parties held before living together.

The four stages:

  1. Identify and value the property;
  2. Consider the contributions of each party (including non-financial contributions such as caring for children);
  3. Consider the future needs of the parties; and
  4. Work out whether the settlement is fair for both parties.

Because the settlement aims to end the financial relationship, it must include all property.

You can enter into a financial agreement to record the terms of the settlement. You can also ask a court to make orders in case enforcement becomes necessary. If it’s impossible to reach an agreement, you may need to apply to a court to decide.

We’ll advise you about the way how this works at our first consultation.

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How long will it take to reach a property settlement?

The length of time that it takes to settle varies from case to case.

Some settlements take months, but others go on for years. It depends on whether we can locate all the property, how easily we can assess the financial needs of both parties, and most importantly, the willingness of both you and your former partner to reach an agreement.

Frequently asked questions

Provided that you lived with your former partner for at least two years on a genuine domestic basis, your entitlements to the property of the relationship will be worked out using the four-stage test in the Family Law Act.

Read more about your de facto relationship entitlements.

You may love your pet like one of your children, but family law treats pets as personal property. There are no custody or visitation rights.

They will form part of a property settlement, just like jewellery and other valuables. We can help you settle any pet issues with your former partner.

If you inherit money or assets before separation, the law may consider this a financial contribution by you to the relationship.

If you inherit after separation, you may have a convincing argument that you should be able to keep the whole inheritance.

Inheritance laws will apply. How those laws will affect your situation will depend on whether you’re married or in a de facto relationship. If it’s likely that you or your former partner will inherit from a deceased estate, it’s worth getting legal advice to work out where you stand.

What’s next?

Your lawyer will need to know the important dates in your relationship, for example:

  • When you started living together
  • When you got married
  • Date of separation
  • When you combined your finances

You’ll also need to give your lawyer a list of your valuable belongings, such as furniture, jewellery, cars or other items. Written valuations are also useful.

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Give your lawyer as much financial information as possible, for example:

  • Bank statements
  • Tax returns
  • Mortgage documents
  • Investment documents
  • Credit card statements
  • Household bills and rent receipts
  • Business statements
  • Superannuation statements
  • Employment contracts
  • Other entitlements such as Centrelink payments
  • Children’s expenses such as school fees and activities
  • Division of child caring responsibilities
  • Details of any companies or trusts in which you or your former partner have an interest

You don't need to wait until you've separated or divorced before seeking legal advice about property division.

As soon as you’re aware that separation is possible, or as soon as you’ve separated, we recommend that you contact us for legal advice.

Often, the more quickly you act, the easier it is to find financial documents and locate all assets and liabilities. You’re also likely to have a clearer idea of your finances.

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