New Superannuation Transparency Measures in Financial Proceedings


New Superannuation Transparency Measures in Financial Proceedings

The Federal Government has passed legislation seeking to improve the visibility of superannuation assets in family law proceedings.

When a couple separates and is looking to divide their assets, the law and the court rules require that each person provides full and frank financial disclosure regarding their assets, liabilities, income and financial circumstances (including superannuation) to the other side. Unfortunately, due to hostility, difficulty, disorganisation or a desire for secrecy, it is not unusual for parties to financial matters to not provide proper disclosure, or to provide disclosure that is incomplete.

As it currently stands, parties to financial proceedings that have been filed in the Federal Circuit and Family Court of Australia can obtain information and records about assets, including superannuation, by subpoenaing information directly from banks, government agencies and superannuation providers. From 1 April 2022, however, parties with financial matters before the Court will also be able to apply directly to the Australian Taxation Office (ATO) for details of their ex-partner’s superannuation, including the identity of their superannuation funds and the funds’ values.

Currently, it can sometimes be difficult and costly to locate and quantify an ex-partner’s superannuation, especially if they have spread it across multiple superannuation funds. The hope is that this new process will reduce legal costs and delays for those – more often than not women or people from low income households – who need information about their ex-partner’s superannuation in order to sort out division of the matrimonial assets.

Cases involving the division of superannuation can be complex. Although superannuation is considered as part of the net matrimonial property pool, splitting superannuation is different to dividing other assets, as superannuation must usually be kept in the superannuation system rather than immediately paid out. Because of this, superannuation splitting orders are generally detailed and complicated, and are very difficult for parties to get right without legal assistance. To address this however, a new streamlined, plain-language super splitting request form has been developed alongside the ATO information request process, which in pilot programs significantly reduced the time a superannuation split took to process. It is hoped that this new method will make super-splitting more accessible, and allow superannuation to be more easily divided by more people in more cases.

Although a positive step, the new ATO information request process will only be available to parties who have filed Court proceedings and have a financial matter currently before the Court. As now, parties who want to settle their matters without going to Court, but who are unable to do so because their ex-partner will not provide disclosure, will still have to look at commencing Court proceedings in order to compel disclosure by their ex, or to subpoena information to be released.

For further information regarding asset division, financial matters or superannuation orders, or for general questions regarding matters of family law, please contact the Hunt & Hunt family law team on (02) 9391 3000.

Article prepared by: Benjamin Keyworth, Associate

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