It is not commonly known that during family law property settlements, your superannuation entitlements form part of the matrimonial or de facto asset pool. Superannuation differs from other assets such as real property, money and vehicles because it is technically held in trust by the super fund.
Part VIIIB of the Family Law Act 1975 allows for superannuation entitlements to be included and divided as part of the asset pool. When a parties superannuation is divided under Section 90XT, it is referred to as a ‘splitting order’. To action a splitting order, the party seeking the split must write to the trustee of the super fund to advise them of the proposed split they are seeking. This is referred to as granting the super fund ‘procedural fairness’ by notifying them of the intention and seeking the super fund’s approval.
It is a requirement of family law property matters, that parties disclose their financial positions to each other to allow for informed negotiation over the division of assets.
However, sometimes in family law matters which are particularly acrimonious, parties may attempt to hide their assets, including superannuation, from their former partner. This can lead to unnecessarily lengthy, frustrating and expensive experiences.
In an effort to increase the “visibility” of superannuation in family law matters, the (somewhat wordy) Treasury Laws Amendment (2021 Measure No. 6) Bill 2021 (Schedule 5) came into force on 1 April 2022. As part of this amendment, parties to litigated family law matters can now apply to the Federal Circuit and Family Court of Australia to find out what their former partners superannuation holdings are.
To make such an application, the applicant must be a party to family law property proceedings before the Federal Circuit and Family Court of Australia. The Court, after approving the request, communicates with the Australian Taxation Office, who in turn provide the requested superannuation information back to the Court. The information will typically include:
- The name of the owner and their client number.
- The identity of the Super fund and their ABN.
- The reported balance and the date this was last reported.
This information is generally provided within a period of 7 days, making for a much quicker and simpler means for parties to Court proceedings to find out their former partners superannuation holdings.
On some occasions, parties may agree to exclude their superannuation entitlements from negotiations. However the inclusion of superannuation in the asset pool is important in examples where one party might be a stay-at-home parent, or otherwise not in the workforce for significant periods of time. Further, the older the parties are, the more likely their superannuation is to be high in value and comprising a significant asset.
At Everingham Solomons we have the expertise and experience to assist you with all matters relating to family law matters, because Helping You is Our Business.
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