In this two-part blog post, we explain how to divide assets when separating. In Part 1, we looked at the process of valuing your real property, personal property and superannuation.

This week, we discuss how these assets are typically divided by the Courts when a marriage or de-facto relationship ends.

1. How real property and personal property assets are divided 

As we explained last week, “real property” includes your house, investment properties, holiday house, land or business properties that you own. “Personal property” includes cars, shares, furniture and businesses.

How these assets of a separated couple will be divided depends on a number of factors.

2. How superannuation is divided

The way the Courts divide superannuation is normally by applying a formula.

For example:

John’s super at the time of the property settlement (not the date of separation) is –


       Plus Jane’s super = $150,000

          Total super pool = $500,000

               Divide by half = $250,000

       Less Jane’s super = $100,000

Therefore, John would pay $100,000 from his super fund to Jane’s super fund, so they each have $250,000. If, say, John already had $100,000 in his fund when he and Jane began living together, say 10 years ago, that would normally be quarantined and taken off his current $350,000 to calculate Jane’s entitlement.

Alternatively, he may get a % adjustment in his favour of the total superannuation pool to account for his greater contribution to it. The amount of the super “split” doesn’t usually depend on the parties’ incomes or who is caring for any children.

Assessing each person’s contribution to the relationship

Once the Court has identified the net value of the asset pool, the law needs to then identify and assess all of the parties’ contributions to the relationship.

This includes (but is not limited to) income, renovations to property, homemaker contributions such as cooking and cleaning, and contributions as a parent to children of the relationship, or to children from a previous relationship.

Other relevant contributions that must be taken into account include inheritances, gifts of money from parents, compensation payouts or what is known as a “windfall” (a lottery win, for example).

Assessing future needs of each party

The Court then assesses the future needs of each of the parties. This includes considering a number of variables such as the age of the parties, their health, income earning capacity, and who will be the primary carer of the children.

Essentially, the law must consider whether there are any factors that may impact on a person’s capacity to support themselves now and into the future.

So for example, if John and Jane have two children, aged 11 years and 9 years respectively, and the children are going to be primarily in Jane’s care following separation, the law recognises that Jane may have a greater future need.

Having the primary care of a child or children of a relationship can impact on a person’s capacity to work/earn an income, and that must be accounted for in a final property settlement.

The assessment of future needs can be further complicated by health issues or ailments affecting one or both of the parties and significant income discrepancies.

Achieving a fair outcome

Finally, the law requires the Court to be satisfied that the outcome is fair (legally known as, “just and equitable”). The Court considers the outcome in dollar terms when determining whether it is fair in all of the circumstances.

Get expert advice

This process of dividing assets is not an exact science and each situation must be assessed on a case-by-case basis, having regard to the above legal principles.

It’s most important that you consult an experienced family lawyer about these issues, preferably before the separation occurs and certainly before you agree to anything! 

Our job is to help you negotiate a fair division of assets with your partner, avoiding having to take this to Court for resolution wherever possible. 

To get started, simply book an initial appointment with one of our experienced and supportive family law team today by calling 9435 9044.