Australian Family Law

5 steps to dividing property after separation

When you’re separating or thinking of separating, wondering how your property will be divided is usually front of mind.

5 minute read
Woman going through separation in her 50s holding plant in colourful garden with blurred foreground

Where will I live? How will I support myself? How will I support my kids? These are the common worries we hear that add further stress to an already stressful situation.

Whether your matter is in court or not, there are some guiding principles here in Australia on how property is dealt with after a relationship has broken down. These guiding principles create the five key steps of dividing property after separation, outlined below.

Step 1 – Determining rights in property

The first step in dividing property after separation is to decide whether it’s necessary to make an order altering legal and/or equitable rights in property – and whether the Court has the power to do so.

Step 2 – Identifying assets, liabilities and resources

All your assets, liabilities and financial resources need to be identified. The values are usually determined by way of agreement. However, if there’s no agreement, you can get formal valuations.

It’s important to understand that any values will be the value at the date the court determines the matter, except in certain circumstances. This may be particularly relevant where the property market is in a boom phase.

Step 3 – Court determines contributions

A court will determine what financial and non-financial contributions you and your ex-partner have individually have made (both directly and indirectly) to acquiring, maintaining and improving property of your relationship. This requires balancing a number of factors.

  • Directly includes a lump sum payment against a mortgage
  • Indirectly includes contributing weekly earnings to household expenses

Step 4 – Future needs considered

The future needs of you and your ex-partner are then examined. This includes considerations such as:

  • Differences in income
  • The health of you and your ex-partner
  • Whether one of you have the children in their care more than the other

When dividing property after separation, if one party is found to have greater future needs, this may be recognised through receiving more of your asset pool.

Step 5 – Is the decision just and equitable?

The final step in dividing property after separation is deciding whether altering the property decision is required and if it’s just and equitable in all circumstances in relation to the matters raised above to make orders.   

Unfortunately, there are no strict methods that can be used to determine how your property will be divided after you separate. The Court has significant discretion to decide how assets are divided. This is why there are risks in going to Court.

Next steps

If you’re separated or considering separation and unsure of what to do next, call us today for a free, confidential chat about your potential entitlements.

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