It can be difficult to determine "who gets what" in terms of property settlement following a separation, but it can be even more challenging to determine how to deal with superannuation. What do you need to know about "splitting" this?
A Different Type of Asset
Superannuation can definitely be considered as property and as such a part of the pool for negotiation following the separation. However, it is handled entirely separately and is a different "type" of property as compared to other elements like bank accounts or houses. Fundamentally, the superannuation has to be valued, and it is possible to split entitlements, although this is not necessarily always the case.
Is it Convertible?
Superannuation is treated separately as any split entitlements are not immediately converted into a cash interest. This is because superannuation laws dictate that benefits are not usually issued until the party reaches retirement age. Therefore, if you're looking to try to convert some of your partner's superannuation into cash, you will probably have very limited grounds for doing so. Most fund managers will only consider this in cases of extreme hardship, for example.
How to Approach This
If you can, you should aim to come to an agreement with the other party to determine how the superannuation is going to be split. Some people choose to do this informally and without making any application to a court, but you will still need a proper written agreement and should seek independent legal advice in this case. Perhaps the best way to go about it is to get consent orders registered to dictate how the split will be handled. Of course, it is also possible to get a court order if you cannot reach agreement with the other party.
What to Be Careful of
You should know that there are very specific processes involved, and the consent orders or court orders have to be worded properly if they are to be enforceable. Many people who choose to do this themselves find that the wording of the orders is not acceptable according to strict legislation and may be rejected by the central registry. You should also note that the trustee of the fund must also agree with the terms and conditions and will have the opportunity to object if they do not.
With all this in mind it's best to consult with a property lawyer experienced in superannuation matters to help you.Share
18 November 2016
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