In the landscape of family law in Australia, one of the critical areas that often arises during the settlement process is the treatment of superannuation. Understanding how superannuation is handled can significantly impact the outcomes of a property settlement, making it a crucial aspect for separating couples to consider. At Palmer Legal, we aim to provide clarity on this complex issue to help you navigate your legal journey.
What is Superannuation?
Superannuation, commonly referred to as "super," is a compulsory retirement savings scheme in Australia. Employers contribute a percentage of an employee's earnings into a superannuation fund, which is preserved until the employee reaches retirement age. Superannuation funds accumulate over time and can become a substantial asset for individuals.
Superannuation as Property
In the context of family law, superannuation is considered a type of property. This classification means that superannuation entitlements are included in the pool of assets to be divided between separating parties. Unlike other types of property, superannuation is subject to specific laws and regulations, making its division more complex.
Valuing Superannuation
The first step in dealing with superannuation during a separation is to determine its value. This process can vary depending on the type of superannuation fund. Generally, superannuation is valued based on the member's statement provided by the fund. However, in cases involving defined benefit schemes or self-managed superannuation funds (SMSFs), a more detailed valuation may be required, often involving an actuary.
Splitting Superannuation

Once the superannuation has been valued, it can be split between the parties. The Family Law Act 1975 (Cth) provides the legal framework for superannuation splitting, allowing it to be divided as part of the property settlement process. There are two primary methods for splitting superannuation:
Superannuation Agreement:Â Separating parties can reach a mutual agreement on how to split their superannuation. This agreement must be formalized and meet certain legal requirements to be binding.
Court Order:Â If an agreement cannot be reached, either party can apply to the court for an order to split the superannuation. The court will consider various factors, including the length of the marriage or relationship, contributions made by each party, and future needs.
Factors Considered in Superannuation Splitting
When determining how to split superannuation, the court or the parties will consider several factors, including:
Contributions:Â Both financial and non-financial contributions made by each party during the relationship.
Future Needs:Â The future financial needs of each party, including age, health, and earning capacity.
Length of the Relationship:Â The duration of the marriage or de facto relationship.
Implementing the Split
Once a superannuation split has been agreed upon or ordered by the court, it must be implemented by the superannuation fund. This process involves submitting the relevant documents, such as the superannuation agreement or court order, to the fund. The fund will then adjust the member's account to reflect the split.
Tax Implications
It's essential to consider the tax implications of superannuation splitting. Generally, superannuation splits are tax-free at the time of the split, but there may be tax consequences when the funds are accessed in the future. Consulting with a financial advisor can help you understand the potential tax impact.
Seeking Legal Advice
Navigating the complexities of superannuation in family law requires a thorough understanding of both legal and financial aspects. At Palmer Legal, our experienced family law team can provide expert advice and guidance to ensure your superannuation entitlements are appropriately considered and divided. We are committed to helping you achieve a fair and equitable outcome during your property settlement.
If you have any questions or need assistance with your family law matter, please contact Palmer Legal for a confidential consultation. We are here to support you every step of the way.
Disclaimer:Â This blog post is intended for informational purposes only and does not constitute legal advice. For personalized legal advice, please consult with a qualified family law solicitor.
Melanie Palmer
Ph: +61 2 4869 1392
Email: melanie@palmerlegal.net.au
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