30 Jun THE RISKS OF NOT DOCUMENTING YOUR PROPERTY SETTLEMENT
Have you and your partner come to an agreement as to how you’re going to split your assets and liabilities? If you have, congratulations, you’ve worked through what some couples find to be the hardest part – the negotiations.
Now you need to
At Resolve Divorce Lawyers, we often hear from clients who have separated without
There are considerable risks involved if you choose not to document the agreement reached between you and your former spouse.
Firstly, it is important to be aware that there are time limits for filing proceedings for property settlement or spousal maintenance with the Court. For married couples it is one year from the date of divorce and for de facto couples it is two years from the date of separation. This means that if you stay married to your former spouse, then they can apply to the Court for property settlement or spousal maintenance many years after the date that you separated.
There are also a number of other risks associated with not documenting your property settlement.
1 Someone might change their mind
The best time for you and your former spouse to agree to
finaliseyour property settlement and make it binding and enforceable is when you have both decided on how the property will be divided and when you are still on reasonable terms.
2 The asset pool might change
The law is very clear that the property pool (your assets, liabilities
It is worth remembering that the more time that passes following separation, the more the state of your respective financial affairs will have changed. This may increase the number of issues for negotiation (or if negotiation fails, to contest in Court).
3 Stamp duty and CGT relief
If you decide to transfer any property to your former spouse, you will avoid paying stamp duty if the transfer is pursuant to either a Consent Order or Binding Financial Agreement.
Similarly, with capital gains tax, if a property is transferred to a spouse through a court order or binding financial agreement, the transfer may attract a “rollover relief” which will postpone the payment of CGT, or exempt the party from payment. Transfers of shares
4 Someone may re-partner
If either you or your former spouse re-partner and that relationship is considered to be a de facto relationship (which means that you have been living together on a genuine domestic basis for more than two years) then either your former spouse’s new partner, or your new partner might be entitled to any asset held by you (and vice versa). Not only does this add complexity to your case, but it increases issues that require attention in any future negotiations which can cost you more money and more time.
5 In the event of a death
When property settlements are left open for long periods of time, there is always a possibility that either you or your former spouse may die before your property settlement is
How do we Assist You to Document Your Property Settlement?
At Resolve Divorce Lawyers, we strongly recommend that you document your property settlement.
It is a pretty straightforward process and a worthwhile investment. You can either execute it by way of Application for Consent Orders filed with the Family Court of Australia, or by way of Binding Financial Agreement.
We can offer you a fixed fee for preparing the necessary documents and we can do it as quickly as you may need it done.
If you and your former spouse have reached an agreement, contact one of our lawyers and we can assist you to finalise your agreement in legally binding documents protecting you against the many pitfalls we have described.
Call our office on (08) 7228 6110 or email firstname.lastname@example.org.
This post was developed by our Senior Solicitor, Chanel Martin.