Is superannuation taken into consideration for Family Law settlements?
Yes, since it was amended in 2002 the Family Law Act (Cth) has provided that superannuation is to be treated as property in family law proceedings, allowing it to be ‘split’ between separating spouses or de facto partners. So like any other asset, superannuation can be divided between parties when determining a property settlement.
Although superannuation is capable of being split, superannuation is different to other assets in that it generally can’t be accessed until a condition of release has been met. For this reason, superannuation is often placed in a ‘superannuation pool’ of its own, separate from the non-superannuation assets, although sometimes a global approach is adopted.
How much super?
In long relationships superannuation is often split equally. However, there are circumstances which can lead to an unequal split of superannuation. For example, where one party had a significant amount of superannuation prior to the commencement of the relationship.
The case of Palmer and Palmer  FamCAFC 159 involved circumstances where the Husband entered the relationship with significant superannuation. In this case, the Full Court quarantined the pre-relationship superannuation from the value of the Husband’s superannuation interests at the time of the Hearing. The value of the Husband’s superannuation at the date of cohabitation was deducted from his final entitlement, and the balance was then divided equally between the parties.
What type of super can be split?
Most people have superannuation held in accumulation plans, which effectively operate as cash deposits invested by your superannuation fund.
There are also superannuation plans called ‘defined benefit’ plans. The value of a defined benefit interest at any given time is calculated as the product of a number of factors such as average salary, age, and length of tenure with the employer. A family law valuation is required in relation to a defined benefit interest.
Self-managed superannuation funds are generally valued with the assistance of an expert such as an accountant.
It is accordingly important that, before negotiating the amount of superannuation to be split as part of a property settlement, that the type of fund being considered is determined and its proper value for family law purposes has been ascertained.
Harris Lieberman Solicitors can provide you with advice before deciding what sort of superannuation interests are involved and the applicable valuation requirements.
How is Superannuation Split?
The following options are available:
- Enter into a formal written agreement to split superannuation that requires both parties to instruct (separately) a solicitor who must sign a certificate stating that independent legal advice about the agreement has been provided. Once this agreement is made, you do not need to go to Court. The agreement is not registered; or
- Seek Consent Orders to split superannuation; or
- Seek a court order to split superannuation if you cannot reach an agreement.
You should discuss with your solicitor which option would best suit your needs.
At Harris Lieberman our Family Law Solicitors can provide you with tailored advice about how superannuation will be treated in your property settlement. If you would like further information, please contact our Family Law Assistants on (02) 6051 5100 to make an appointment.