Divorce can be challenging, especially when it comes to dividing assets like superannuation. In Western Australia, super is considered property under family law, meaning it can be split between separating partners. However, it’s not always a simple 50/50 division. Understanding how superannuation is treated and taking the right steps can help secure your financial future.
How is Superannuation Treated in a Divorce?
Superannuation is included in the total asset pool but is not automatically split equally. The division is based on individual circumstances, taking into consideration contributions made by each party, both financial and non-financial, and the future needs of each party. If an agreement can be reached in relation to division of superannuation, it may be made legally binding by either consent orders or a binding financial agreement. Knowing which method is most appropriate requires specific advice about your particular situation.
Once a superannuation split is agreed and formalised, it is important to understand that super remains subject to preservation rules; meaning you generally can’t access it until retirement age.
Quick Tips to Help Protect Your Super
1. Gather Accurate Financial Information
- Obtain recent statements of your super balance.
- Ensure full financial disclosure from both parties to prevent disputes.
2. Consider a Superannuation Splitting Agreement
- A super split does not convert super into cash—it remains within the fund until retirement.
- The agreement can specify a percentage or fixed amount to be transferred to your ex-partner’s fund.
3. Understand the Tax and Financial Implications
- Super splitting doesn’t usually trigger immediate tax liabilities, but future withdrawals may be taxed.
- Consulting a financial advisor can help you plan for long-term financial security.
4. Seek Legal Advice Early
- A family lawyer (like us at Coastal Family Law) will help you understand your entitlements and negotiate a fair outcome.
- If needed, they can assist in preparing a binding financial agreement or court application.
Navigating superannuation division can be challenging, but with strategic planning and supportive legal expertise, we will help you secure your financial future. Get in touch to chat with our friendly team if you have any questions at all.
