When parties are going through a property settlement, the law treats superannuation interests as property. Superannuation interest can be divided or ‘split’ between the parties depending upon how much of the property pool each party is entitled to retain.
Superannuation cannot be converted into cash and will be subject to superannuation laws i.e. that it cannot be accessed until retirement age.
During a relationship, the lower income earning partner or in some cases the primary carer of any children, will usually accrue less superannuation. Therefore, when the parties separate, it may be considered just and equitable for the lower income earning partner to receive by way of a superannuation split part of the superannuation accumulated by the other party.
Judges have significant discretion in terms of how to divide a couple’s superannuation interests to determine a just and equitable outcome for the parties.
Some factors that may be taken into consideration by a Judge include:
- Whether there are any children of the relationship;
- The effect of the superannuation split on the primary carer of the children;
- The need for cash of the parties;
- The valuer of the superannuation compared to the value of the property pool;
- The type of superannuation;
- The age of the parties and the length of time before the parties can access their super; and
- Any possible tax implications.
When you agree on a superannuation split, you must also provide the trustee of the superannuation fund procedural fairness by allowing them to ensure the superannuation split can occur in the manner that you propose.
Richardson Murray are experienced family lawyers with expertise in family law settlements, including superannuation. If you require assistance, please do not hesitate to contact Richardson Murray on 5619 5933.