A guide for individuals, business owners, and their professional advisers
When a relationship ends and the financial interests are substantial, the decisions made in the months after separation, about property, business interests, children, and money, can shape outcomes for decades.
This guide is for people navigating a complex family law matter, and for the accountants, financial planners, corporate solicitors, and private wealth managers who advise them. It is not a general introduction to divorce. It is a reference for matters where the stakes are high and the asset structures are sophisticated.
Koffels has acted in some of Australia’s most significant family law proceedings. The nature of that work means we will not discuss it publicly. The same discretion applies to every client we represent.
1. The legal framework
Family law in Australia is governed by the Family Law Act 1975 (Cth). It applies to married couples and, in most respects, to de facto couples in a qualifying relationship. Because it is federal law, the same rules apply in every state, with one exception: de facto property matters in Western Australia are dealt with under WA state law.
Since 1 September 2021, family law matters have been heard in the Federal Circuit and Family Court of Australia (FCFCOA), which replaced the Family Court and the Federal Circuit Court. Appeals go to the FCFCOA’s appellate division and, in limited cases, to the High Court.
Two recent rounds of reform have changed the law significantly:
| Legislation | Commenced | Key changes |
|---|---|---|
| Family Law Amendment Act 2023 | 6 May 2024 | Parenting: removed the presumption of equal shared parental responsibility and simplified the factors courts use to decide a child’s best interests |
| Family Law Amendment Act 2024 | 10 June 2025 | Property: set out the steps for property settlement in the Act, required courts to consider the economic effects of family violence, moved the duty of disclosure into the Act, and introduced orders about companion animals |
Australian family law does not follow a formula. Courts have broad discretion, especially in property matters, and the outcome depends on the facts, the quality of the evidence, and how well the matter is prepared and negotiated. Read more on our law reform and process page.
2. Property settlement
Property settlement ends the financial relationship between separated parties. For business owners and people with significant wealth, it is usually the most consequential part of the process, more so than the divorce itself, which is largely administrative.
How courts decide a property settlement
The steps courts follow are now set out in the Family Law Act:
| Step | What the court considers |
|---|---|
| 1. Identify the asset pool | Each party’s property, liabilities, and financial resources, including interests in trusts, companies, superannuation, and overseas assets. How an interest is characterised can shape the whole settlement. |
| 2. Assess contributions | Financial and non-financial contributions to acquiring, conserving, and improving property, including contributions as homemaker and parent. The economic effect of family violence on a party’s ability to contribute is also considered. |
| 3. Consider current and future circumstances | Earning capacity, care of children, age, health, and other factors. Significant income disparity or career sacrifices can lead to material adjustments. |
| 4. Just and equitable outcome | The court only makes orders that are just and equitable in all the circumstances. |
Both parties have a continuing duty of full and frank financial disclosure, covering all assets, liabilities, income, and financial resources, including interests in entities and overseas holdings. Courts treat non-disclosure seriously. They can draw adverse inferences, set aside settlements, and impose costs or other penalties. Read more about property settlement and high-net-worth divorce.
3. Business interests in property settlement
For business owners, the key questions are how the business is valued, how goodwill is treated, how shareholder arrangements interact with family law orders, and how changes in value after separation are handled.
Valuing a private business
A private business has no market price, so its value must be assessed by a forensic accountant. Common methods include capitalisation of future maintainable earnings, discounted cash flow, and asset-based approaches.
Small changes in assumptions, such as the earnings multiple, discount rate, or how the owner’s salary is treated, can produce very different results. In contested matters, the parties’ experts sometimes differ substantially, and the court must decide which evidence to prefer. See how a business is valued in a family law property settlement.
Personal and enterprise goodwill
| Personal goodwill | Enterprise goodwill | |
|---|---|---|
| What it is | Value from the owner’s own skills, reputation, and relationships | Value in the business itself: systems, client base, brand, and processes |
| Transferable on sale? | No | Yes |
| In the asset pool? | Generally not, although the income it generates is relevant to future circumstances | Yes |
The line between the two is often contested, particularly in professional practices built on the reputation of their principals.
Shareholder agreements
Pre-emption rights, drag-along provisions, buy-sell mechanisms, and transfer restrictions in a shareholder agreement can all be affected by a settlement or court orders. Courts can make orders that bind third parties, including co-shareholders, but those powers operate alongside the contractual rights in the agreement.
Structuring a settlement that meets its financial goal without triggering adverse consequences under the agreement needs family law and corporate law advice working together, which our full-service practice provides. See the family law risk hidden in your shareholders agreement.
Changes in value after separation
Property is generally valued at the time of the hearing or settlement, not at separation. Where a business grows after separation, that growth is usually included in the pool, but the court considers who generated it. Growth from one party’s post-separation efforts is generally credited to that party as a contribution. Growth from market conditions or the underlying value of an asset acquired during the relationship is more likely to be shared.
4. Discretionary trusts and superannuation
How discretionary trusts are treated is one of the most technically complex and actively litigated areas of Australian family law.
- Kennon v Spry [2008] HCA 56: The High Court looked past the legal form of a trust to its substance. Where a party controls a trust, for example as trustee with power to distribute to themselves, the trust assets may be treated as their property rather than merely a financial resource.
- Woodcock (No 2) [2022] FedCFamC1F 173: The court held that a beneficiary’s rights under a discretionary trust, the right to due consideration and due administration, can be property capable of valuation, even without control of the trust.
The trust deed, the history of distributions, the party’s influence over the trust, and the interests of other beneficiaries all affect how a trust will be treated. Read more about discretionary trusts after Woodcock.
Superannuation and SMSFs
Superannuation is treated as property. Accumulation and defined benefit interests can be split by agreement or court order. Self-managed super funds add complexity, because the fund’s trust deed governs how it operates and illiquid assets can make splitting difficult. It is worth involving the fund’s accountant and auditor early.
5. Binding Financial Agreements
A Binding Financial Agreement (BFA) is a private contract setting out how financial matters will be dealt with if a relationship ends. It can be made before, during, or after a relationship. A properly made BFA removes the matters it covers from the court’s jurisdiction.
For people entering a relationship with substantial assets, business interests, or inherited wealth, a BFA is the main planning tool available. For business owners, it can protect the business from disruption, protect co-owners from litigation, and avoid a forced sale.
Making a BFA enforceable
For a BFA to be binding:
- it must be in writing and signed by both parties
- each party must get independent legal advice from a separate lawyer before signing
- each lawyer must sign a certificate confirming advice was given about the agreement’s effect on that party’s rights and its advantages and disadvantages.
Courts have set BFAs aside for fraud, non-disclosure, undue influence, unconscionable conduct, and defective legal advice. Agreements signed under time pressure, such as in the days before a wedding, attract particular scrutiny.
A BFA for someone with significant assets should deal with pre-relationship assets and their growth, business interests and how they will be handled on separation, current and expected inheritances, spousal maintenance, and how the agreement will be reviewed. Read more about Binding Financial Agreements.
6. De facto relationships
De facto couples are treated much like married couples for property and maintenance, with important differences in eligibility and time limits.
A de facto relationship exists where two people who are not married live together on a genuine domestic basis. To make a property claim, the relationship generally must have lasted at least two years, or there must be a child of the relationship, or one party must have made substantial contributions that would cause serious injustice if not recognised. Registered relationships also qualify.
| Time limit | Married couples | De facto couples |
|---|---|---|
| Applying for divorce | After 12 months’ separation | Not applicable |
| Applying for property orders | Within 12 months of the divorce order taking effect | Within two years of the relationship ending |
Late applications need the court’s permission, which is not guaranteed. A BFA is just as relevant, and often more urgent, for de facto couples. See separation and de facto relationships and de facto vs married: your rights on separation.
7. Cross-border and international matters
Clients with assets, children, or connections in more than one country face additional complexity.
- Jurisdiction: Australian courts can make orders about overseas assets, but enforcing them requires engaging with the foreign legal system. In parenting matters, jurisdiction generally depends on where the children usually live.
- International child abduction: Australia is a party to the Hague Convention on the Civil Aspects of International Child Abduction. Where a child is wrongfully taken to or kept in another Convention country, the Convention provides for their prompt return. These applications are urgent and run differently from ordinary parenting cases.
- International relocation: Where a parent wants to move overseas with a child, the court’s focus is the child’s best interests, weighing the reasons for the move and how the child’s relationship with the other parent would be maintained.
- Overseas property: Australian courts generally include overseas property in the pool and can order its transfer or sale. Where assets are in countries with their own matrimonial property rules, coordinated advice in both countries is essential.
Read more about cross-border and international family law and enforcing overseas parenting orders.
8. Parenting arrangements after separation
In parenting matters, the child’s best interests are the paramount consideration. Since 6 May 2024, there is no presumption of equal shared parental responsibility, and courts consider a simplified set of factors:
- the safety of the child and of each person who cares for them, including from family violence
- the child’s views
- the child’s developmental, psychological, emotional, and cultural needs
- each proposed carer’s capacity to meet those needs
- the benefit to the child of a relationship with each parent and other significant people, where safe
- anything else relevant to the child’s circumstances.
For Aboriginal and Torres Strait Islander children, courts must also consider the child’s right to connection with their culture.
Family violence
Family violence, including coercive control, is a central consideration. Where serious allegations are made, the court may appoint an Independent Children’s Lawyer to represent the child’s interests. State family violence orders and federal parenting orders can operate at the same time, and conflicts between them must be carefully managed. See the differences between ADVOs, AVOs, and other protective orders and our page on parenting arrangements.
9. The process
Before proceedings
Most family law matters, including those involving substantial assets, are resolved without a final hearing. The process usually involves financial disclosure, negotiation between lawyers, and often mediation. In parenting matters, family dispute resolution is generally required before filing in court, with exceptions such as family violence or urgency.
In complex property matters, forensic accountants and valuers are often engaged early. Agreeing on valuations, or narrowing the differences between them, can be one of the most important steps in the matter.
Collaborative law
In collaborative law, both parties and their lawyers agree in writing to resolve the matter without going to court. For people who want a private, controlled, and dignified process, it can work well in complex matters, especially where the parties share a business or children. See how collaborative law can help you avoid court.
Court proceedings
If agreement isn’t possible, proceedings in the FCFCOA follow a structured case management pathway. In property matters, this typically includes a first court date, a Conciliation Conference, and directions towards a final hearing. Complex matters can take two years or more to reach a final hearing, which is one reason early, well-structured negotiation is almost always preferable.
10. For professional advisers
Accountants, financial planners, corporate solicitors, and private wealth managers often have clients going through a family law matter. Issues that arise regularly include:
- Disclosure: The duty of disclosure extends to interests in trusts, companies, and investments the adviser may manage, which can affect records the adviser holds.
- Tax: Capital gains tax roll-over relief under the Income Tax Assessment Act 1997 is available for transfers under a court order or financial agreement, but only if the conditions are met. Stamp duty exemptions may also apply.
- Superannuation: Splitting orders interact with SMSF, defined benefit, and accumulation rules, so the family lawyer and the client’s financial adviser need to work together.
- Estate planning: BFAs are increasingly relevant, particularly for clients entering a second relationship with children from an earlier one.
If you advise clients who may need specialist family law help, we welcome referrals and are happy to discuss a client’s circumstances confidentially before any formal instruction. See our page for professional advisers.
11. Our family law practice
- Property settlement and business interests: valuations, trusts, shareholder agreements, and contested asset pools
- Binding Financial Agreements: for people entering significant relationships, business owners, and those with inherited or structured wealth
- Separation and de facto relationships: rights, time limits, and first steps after separation
- Cross-border and international family law: child abduction, overseas property, relocation, and multi-jurisdiction proceedings
- High-conflict parenting matters: serious allegations, family violence, and international relocation
- Law reform and process: the 2023 and 2024 reforms, collaborative law, and court procedure
- For professional advisers: resources for accountants, financial planners, and corporate solicitors
Frequently asked questions
Is property always split 50/50 in Australia?
No. There is no automatic 50/50 rule. Courts identify the asset pool, assess each party’s contributions, consider each party’s current and future circumstances, and make orders only if the result is just and equitable. Outcomes vary widely depending on the facts.
Is a business included in a property settlement?
Usually, yes. A business interest is generally part of the asset pool and must be valued, often by a forensic accountant. Personal goodwill tied to the owner’s own skills and reputation is generally excluded, although the income it produces is relevant to the settlement.
Can assets in a family trust be divided?
They can be. Where a party controls a discretionary trust, the court may treat its assets as that party’s property. Even without control, a beneficiary’s rights can sometimes be property capable of valuation. The outcome depends on the trust deed and how the trust has operated.
What is the time limit for a property settlement?
For married couples, property proceedings must generally be started within 12 months of a divorce order taking effect. For de facto couples, the limit is two years from the end of the relationship. Late applications need the court’s permission.
Is a Binding Financial Agreement always binding?
Not always. Courts can set a BFA aside for reasons such as fraud, non-disclosure, undue influence, or defective legal advice. Following the formal requirements carefully and avoiding last-minute signing makes it much harder to challenge.
Do I have to go to court?
Most matters, including complex ones, are resolved by negotiation, mediation, or collaborative law without a final hearing. Court proceedings are needed when parties cannot reach an agreement or when a matter is urgent.
Speak with us in confidence
If you are facing a family law matter with significant stakes, contact us for a confidential, no-obligation discussion. Call 02 9283 5599 or use the form below. You can also read more about our family law and divorce services.
This guide is general information only and is not legal advice. Family law outcomes depend heavily on the facts, so you should get advice from a qualified family lawyer about your circumstances.
