Superannuation in Family Law
In Western Australia, how your and your ex-partner’s superannuation will be treated in the event of separation depends on one key point – whether or not you are or have been married.
If you are (or have been) married, superannuation is treated as property. Separated married couples may therefore split their superannuation by way of a binding financial agreement or by Court order.
An important point to remember is that when superannuation entitlements are split, they are transferred from one superannuation fund to another. You are not able to split super from one spouse and turn it into cash or a different asset for the other spouse (unless either party is over the “preservation age”, in which case there may be circumstances where the superannuation can be accessed as cash. The preservation age at the moment is between 55 and 60 years of age, depending on your or your spouse’s date of birth).
Another important factor to remember is that there is no requirement that superannuation in family law be split or that it be split equally between separated spouses in all cases. The Court will consider whether superannuation should be split, and if so, the amount of super to be divided, as part of its consideration of the division of the parties’ property generally.
Whether superannuation will be split, and the amount of any split, will depend on the circumstances of the case.
In the other States of Australia, de facto couples are treated the same way as married couples in that their superannuation can be split as part of a property division as discussed above. In Western Australia however, de facto couples are currently unable to split their superannuation as part of a property division.
This has arguably occurred because Western Australia has its own legislation which covers de facto couples, whereas the other States have referred this power to the Commonwealth parliament.
It has been the intention for some time that Western Australia will adopt the same approach to superannuation for de facto couples as is the case for married couples.
However, there has been some delay in legislating this change because, amongst other things, the Commonwealth parliament has the power to make laws in relation to superannuation, while the WA parliament has the power to make laws regarding de facto couples. The two parliaments have therefore been required to work together to make this change, which has caused significant delays.
Both the WA parliament and the Commonwealth parliament need to carry out further steps before de facto couples in WA will be able split their superannuation. There is currently no set date on when the new laws will come into force. With the current COVID 19 pandemic, it is likely that the implementation of this legislation will be further delayed, as the WA and Commonwealth parliaments focus their energies on responding to the pandemic.
The delay was sitting with the federal government for a number of years, however, they finally passed legislation late last year. The ball now rests in the court of the WA parliament to pass some further laws, at which time the Commonwealth laws will also need to be proclaimed, and de facto couples in WA will finally find themselves in the same position as married couples, and de facto couples in the rest of the country.
This means that for the time being, de facto couples in WA are still unable to split their superannuation. In these instances the Court will treat the superannuation of the parties’ as a financial resource, which although considered as relevant when determining a property division, will not form part of the asset pool available for division, and no superannuation splitting orders can be made by the Family Court of WA for de facto couples.
A final point to note is that the Family Court will determine a property division and implement relevant legislation at the time that a matter comes before it. At the moment it is currently taking approximately 2 years from when a matter is commenced to when it is determined at trial.
The effect of this is that a de facto ex-partner could commence proceedings in the Family Court now, in the hope that by the time that person’s matter goes to trial (i.e. in approximately 2 years), the laws will have changed so as to allow superannuation to be divided.
If you or anyone close to you would like advice in respect of superannuation in family law or superannuation splitting, please do not hesitate to contact the Family Law team at Lynn & Brown on 9375 3411.
About the author: Robert Pearson is an Associate who was admitted as a barrister and solicitor of the Supreme Court of Western Australia in 2013 and is an experienced lawyer specialising in Family Law matters.