Superannuation is money paid by your employer into a designated fund which is designed to support you in your retirement.
Superannuation is property under the Family Law Act and after a relationship breakdown the Court has the power to make orders in respect of each parties’ superannuation interests. Relevantly the court may order:
- That each party retain their respective superannuation interests; or
- That one party’s superannuation be “split” so that the other party receive a percentage or portion of their superannuation.
How to 'Split' Superannuation
Superannuation Agreement
Parties may enter into a financial agreement to spilt their superannuation. However, an agreement will only be binding if both parties have received independent legal advice from a lawyer and the agreement is in writing and signed.
If you enter into a superannuation agreement, you will not need to go to court but you should keep a copy of the agreement.
Consent Orders
Parties may also apply to the court for consent orders if they have agreed on property orders to split their superannuation. Consent orders will formalise the parties’ agreement and make it legally binding.
An application for consent orders can be filed any time after separation but should be filed within 12 months of a divorce or within two years after the breakdown of a de facto relationship.
To obtain consent orders where the orders include an order for a superannuation split, per Family Law Act section 90XT the parties must, among other things:
- attach proof of value of the superannuation interest;
- calculate the value of the superannuation interest; and
- consider any tax consequences of the order.
A copy of the consent orders should be provided to your superannuation trustee once they have been made by the Court.
Court Orders
If you are unable to reach an agreement regarding each parties’ superannuation entitlements, you may file an application with the court and seek a superannuation splitting order.
In determining whether and how to split the parties’ superannuation interests, the Court will have regard to the ordinary legal principles which govern property settlements. These factors include:
- the financial and non-financial contributions of each party;
- the income, property and financial resources of each party;
- the age and health of the parties; and
- whether either party is responsible for the care of a child of the relationship.
Informing Your Superannuation Fund
You must inform the trustee of the superannuation fund if you are seeking orders requiring a superannuation split. This gives the trustee the opportunity to attend court and make submissions on the orders sought by the parties.
If a superannuation splitting order is sought you must serve a sealed copy of the filed application, response or reply on the trustee immediately after filing that document. You must also notify them of orders to be sought at any hearing and the date of the hearing at least 28 days before any such hearing.
You should provide the trustee with a sealed copy of the court orders which provide for a superannuation split.
What Happens After a Superannuation Splitting Order has been Made?
If the court has made a superannuation splitting order in your favour, you will not receive the money right away. The allocated amount will stay in the other party’s superannuation fund until they become eligible to withdraw their superannuation, for example, when they retire or turn 65.
At this time the superannuation payment will be transferred to your superannuation fund, which you will be able to access once you become eligible to access your super.
DISCLAIMER: The information provided above is published for general informational purposes only and is not intended to be nor should it be relied upon as a substitute for legal or other advice.