The asset pool holds more than just a house | Source: Pexels

We begin the series with the question almost every client asks first: after separation, who gets what?

When a relationship ends, the most practical and most contested issues are usually money and the house. Whether you were married or in a de facto relationship, the Family Law Act 1975 (Cth) sets out a clear principle for dividing property: fairness, not an automatic 50/50 split. Whose name is on the title does not decide who keeps it.

This article walks through the whole logic of a property settlement: what counts as shared property, how a court decides who should receive what, and what changed under the new rules that took effect in June 2025.

A property settlement is the legal process of dividing the assets, liabilities and superannuation of a couple after their relationship breaks down. It is not just about splitting possessions: it also determines who carries which debts, and how superannuation is dealt with.

The asset pool is wider than many people expect. The family home and any investment properties, bank accounts and savings, vehicles, shares and business interests, superannuation entitlements, together with mortgages, personal loans and credit card debt, all go into the same pool, regardless of whose name each item is in. The aim is a single outcome that is "just and equitable" in all the circumstances.

For property settlement purposes, de facto couples have essentially the same rights as married couples (with the exception of de facto relationships in Western Australia, which are covered by separate state legislation). What really matters is the deadline: married couples can negotiate at any time after separating, but a court application must be filed within 12 months of the divorce order taking effect. De facto partners must apply within two years of separation.

Missing the deadline is not necessarily fatal, but you will need the court's special permission to proceed out of time, and that bar is not low. Whichever path you take, the earlier you understand your position, the more options you keep.

Courts decide property division through a well-established four-step process. It grew out of decades of case law, and since 10 June 2025, when the Family Law Amendment Act 2024 (Cth) commenced, it has been written directly into s 79 of the Act (s 90SM for de facto couples). What used to be judicial practice is now black-letter law.

Step one: identify the asset pool. All assets, liabilities and superannuation entitlements are listed, whoever holds them, and whether they were acquired before, during or after the relationship. Values are current market values, and independent valuations may be needed where they are disputed.

Step two: assess each party's contributions. These include financial contributions (income, savings, deposits, inheritances and gifts), non-financial contributions (renovating a property, managing the family's finances), and contributions as homemaker and parent. Caring for the family full time is recognised on equal footing with earning the income.

Step three: consider future needs. Age and health, earning capacity, responsibility for children, and the length and effects of the relationship all shape the adjustment. Typically, the party with lower earning capacity or primary care of the children receives an upward adjustment.

Step four: stand back and check. Finally the court steps back and asks whether the proposed outcome is just and equitable in all the circumstances. This is the ultimate fairness check, and any earlier conclusion can be fine-tuned against it.

Work out the numbers first, then talk about the split | Source: Pexels

These amendments are the biggest reshaping of the property provisions in over a decade, and their reach is broad: they apply whether your settlement is decided by a court or negotiated outside one, and they also apply to cases already on foot that have not yet reached final hearing.

The headline change: the economic impact of family violence is now an express consideration in property settlements, and the law makes clear that family violence includes economic and financial abuse, such as controlling a partner's finances, sabotaging their employment, or forcing them into debt. Courts will weigh the effect of that conduct both when assessing contributions and when assessing future needs.

Two further points worth knowing: pets now have their own rules, with courts deciding who keeps a companion animal based on factors such as who cares for it and who pays for it, and joint ownership is off the table; and the duty of full and frank financial disclosure has been written into the Act itself, so the risks and costs of hiding assets are higher than ever.

Most couples reach agreement through negotiation or mediation. Once you have, the critical step is recording it in a legally effective form. There are two common routes: Consent Orders, where the agreement is submitted to the Federal Circuit and Family Court of Australia for approval, and once the court is satisfied the division is just and equitable, the orders carry the same force as a judgment; or a Binding Financial Agreement (BFA), a private agreement signed after each party receives independent legal advice, which binds like a contract.

If negotiation fails, either party can apply to the Federal Circuit and Family Court of Australia for property orders. The court will decide the division through the four-step process, based on each party's financial disclosure and the evidence.

Very few cases actually end in a judgment: in practice, most settle through mediation or negotiation before a final hearing. How to prepare for mediation, and how to negotiate well once you are at the table, is exactly what we will cover in a coming issue. And if there are other family law topics you would like us to write about, let us know in the comments.

The last step of parting well is finishing the paperwork | Source: Pexels

Sun Lawyers · Sydney Office

Every case is different. Before you sign anything or make a major decision, if you would like to understand your entitlements, get a realistic view of the likely range, or turn an agreement into a legally binding document, contact Sun Lawyers. We work in both English and Mandarin.

Phone: 02 9267 4988　｜　Email: enquiry@sunlaws.com

Sydney Office: Suite 703 & 704, 265 Castlereagh Street, Sydney NSW 2000

Website: sunlaws.com.au

This article is general legal information only and is not legal advice.
Please contact us for advice specific to your situation.