What happens to my superannuation in a settlement?
When dealing with property settlement after the breakdown of a marriage or de facto relationship, superannuation is considered as part of the property pool. So, like other assets, super can be divided between parties by agreement or by a Court order.
Super is often one of the main or most valuable assets available for distribution in a settlement, hence it is vital to get proper legal advice when performing a super split.
How does Superannuation get divided in a divorce?
The superannuation splitting laws allow separating parties to value and divide their superannuation after a relationship break down. Parties are able to split the amount remaining in their super fund and make a payment to the other party’s super benefits.
How is superannuation different to other assets?
Superannuation is different from other types of property as it is an asset that is held in trust by the Trustee of the super fund.
As the Trustee controls the funds invested in the super fund, the splitting process is slightly different to the process adopted for other non-super assets in a settlement.
In order to split super from one benefit to the other, the Trustee needs to be given written notice (28 days’) of the intended super split and an opportunity to comment on the wording of the agreement proposed. The Trustee usually requires the agreement or orders to contain very specific, legal wording in order for them to be satisfied.
The effect of splitting superannuation
Splitting does not immediately convert super into a cash asset – it is still subject to superannuation laws and is usually only accessible after the receiving party has reached the eligible retirement age.
By way of an agreement or Court Order, the Trustee of the fund is directed to transfer a portion of their member’s super entitlement to the super fund of the receiving party, There are two ways that a super split can be effected:-
- A new fund is created for the receiving party within the same super fund and the super is then transferred to that new account for that person’s benefit; or
- The splittable amount is rolled out of the fund and into another fund of the receiving party’s choosing.
How do I know how much super my former partner has?
If you are seeking a super split, the Court is required to have evidence of the value of the super amount.
There are a number of ways you can find out the value of your partner’s super:-
- Through the discovery process. All parties to a dispute have an obligation to provide full and frank disclosure of their financial circumstances – including their super benefits. This can be as simple as the other party sending you a copy of their current super statement or an ATO super statement;
- You can make an application to the super fund by completing the Form 6 Declaration and Superannuation Information form; or
- If your matter is subject to Family law Court proceedings, a request can be made to the relevant fund of the other party, via a Registrar of the Court.
Dealing with a super split in a property settlement can be a complicated and confusing process. An experienced family lawyer at Lindbloms Lawyers can help you understand the process.
Make a time to speak to one of our experienced Family Lawyers to ensure you get the right advice and protect your interests.