Key Changes in Property Settlements from 10 June 2025
The Family Law Act 1975 amendments introduce clearer guidelines on how courts will assess property settlements, emphasising fairness, transparency, and the long-term impact of family violence where applicable.
A More Structured Approach to Property Settlements
From June 2025, the family law courts will follow a clearer, four-step process when determining a property settlement:
- Identifying all assets and liabilities – This includes real estate, superannuation, investments, and debts. For high-net-worth individuals, this may involve complex financial structures, trusts, or overseas assets that require expert legal assessment.
- Assessing each party’s contributions – This includes financial contributions (such as income and assets) and non-financial contributions (such as parenting and homemaking responsibilities). Many of our clients have dedicated years to raising children or supporting a partner’s career, and this amendment ensures those contributions are given proper weight.
- Considering future needs – Factors such as age, health, income disparity, and child-care responsibilities will play a role in determining financial outcomes. For clients with businesses, ongoing financial obligations, or significant superannuation holdings, this assessment is crucial to securing a stable financial future.
- Ensuring a just and equitable division – The final decision must be fair in all circumstances. This approach ensures that settlements consider not just what is ‘equal’ but what is ‘fair’ given the complexities of each case.
If you are negotiating a property settlement outside of court, following these four key steps can help ensure your agreement aligns with the new legal framework.
Family Violence and Its Economic Impact on Property Settlements
One of the most significant updates to the law is the recognition of the economic impact of family violence in property settlements. Starting in June 2025, courts must consider:
- Whether one party suffered financial hardship due to family violence (e.g., being unable to work or access joint finances) for clients who have been financially dependent on their partner, the situation could lead to a fairer share of assets to compensate for lost career opportunities.
- The long-term financial consequences of family violence, such as ongoing medical or counselling expenses. Many victims of economic abuse struggle with financial independence after separation, and this amendment ensures their needs are recognised.
- The role of economic abuse, where one party controls financial resources unfairly, is a form of family violence. If a partner withheld funds, controlled bank accounts, or used money as a form of coercion, this will now be factored into property settlements.
This change ensures that victims of financial abuse or coercion receive a fairer share of the property settlement and are not left financially disadvantaged after separation.
Companion Animals in Property Settlements
Under the new laws, family pets will now be considered separately from other property in property settlements. This change is particularly relevant to clients who view their pets as part of the family. When determining who retains a pet, the court must consider:
- Any history of animal abuse or threats involving the pet. This ensures that pets are not placed in a harmful environment.
- The emotional attachment of each party (or children) to the pet. For clients with children, ensuring that pets remain with the parent who has primary care may be an important factor.
- The practical ability of each party to care for the pet. This includes factors such as housing arrangements, financial stability, and daily responsibilities.
Notably, courts will not allow shared custody of pets, meaning one party will be awarded ownership. If keeping your pet is a priority, addressing this during property settlement negotiations or mediation is important.
Financial Disclosure Obligations Strengthened
All separating couples are required to disclose their financial situation fully. Under the amended Family Law Act, this duty of disclosure is now firmly established in legislation, reinforcing that:
- Both parties must provide full, honest financial documentation, which is particularly relevant for high-net-worth individuals with complex financial portfolios.
- Non-compliance can lead to penalties, such as cost orders, dismissal of claims, or even fines. This is especially important for clients concerned about a former partner attempting to hide assets.
- Hiding assets or failing to disclose financial details could result in an unfavourable outcome for the property settlement.
If you are concerned about your ex-partner withholding financial information, an experienced property settlement lawyer can help you ensure full transparency and protect your financial interests.
