There Is No Automatic 50/50 Split
One of the most persistent myths about separation is that everything gets divided in half. It does not. There is no starting presumption of equal division in Australian law, and a settlement that looks even on paper may be nothing like what a court would order.
Property settlements are governed by the Family Law Act 1975 (Cth). Because family law is Commonwealth legislation, the same rules apply to separating couples in Victoria as they do anywhere in Australia. What the Act requires is an outcome that is just and equitable in your circumstances — which means the answer depends on facts particular to your relationship, not on a formula.
Two couples with identically sized asset pools can and regularly do end up with very different settlements.
Step One: Identifying the Asset Pool
Before anything can be divided, everything has to be on the table. The asset pool includes:
- Real estate — the family home, investment properties, and any land held in either name.
- Savings and investments — bank accounts, shares, and managed funds.
- Superannuation — treated as property under the Act, though it cannot simply be handed over as cash.
- Business interests — companies, trusts, and more complex structures.
- Vehicles and personal property of real value.
- Liabilities — mortgages, personal loans, credit card balances, and tax debts.
It does not matter whose name an asset is held in. An account in one party's sole name, a property bought before the relationship, an inheritance received along the way — all of it forms part of the pool to be considered.
This is also why both parties are under a duty of full and frank financial disclosure from the outset. Our guide to financial disclosure obligations sets out what has to be provided and what happens when disclosure falls short.
Contributions: Financial and Non-Financial
Once the pool is identified, the Court looks at what each party contributed to it — during the relationship and after separation.
Financial contributions are the obvious ones: wages, savings brought into the relationship, an inheritance, a gift from family. But non-financial contributions carry real weight too, and this is where the 50/50 assumption most often breaks down. Contributions as a homemaker or parent are recognised by the Act, and a party who stayed home to raise children is not treated as having contributed less than the party who earned the income.
Contributions made after separation count as well. If one party has serviced the mortgage alone for two years since the split, that matters.
Since June 2025 the Act has also required the Court to consider the effect of any family violence on a party's ability to contribute, along with the housing needs of any children of the relationship. If family violence has been a feature of your relationship, it is important to raise it early — it may be directly relevant to the property outcome, not only to any intervention order proceedings.
Future Needs: Why Two Similar Pools Differ
Contributions are only half the exercise. The Court then turns to each party's future needs, considering matters such as age, health, income-earning capacity, who has the day-to-day care of children, and what other financial resources each party can call on.
A party who left the workforce for fifteen years to raise children does not have the same earning capacity as the party who did not, even where their contributions were equal. That difference is precisely what the future needs stage exists to address.
This is the reason two matters with similar asset pools can produce very different results — and the reason it is difficult to predict an outcome from the numbers alone.
The Two 12-Month Rules — And Why They Get Confused
There are two separate 12-month periods in family law, they arise from different events, and mixing them up costs people money.
The first is a waiting period before you can divorce. You must be separated for 12 months before an application for divorce can be filed. This is about ending the marriage itself.
The second is a deadline that runs after your divorce. Once a divorce order takes effect, you have 12 months to apply for property or financial orders.
The critical point is this: there is no waiting period for a property settlement. It is not tied to the divorce timetable at all. Married couples can start dividing their property as soon as they separate — you do not need to be divorced, and you certainly do not need to wait 12 months. Resolving property early is very often the better course, while the financial picture is current and both parties can still get on with their lives.
For de facto couples the rule is different again: applications must be made within two years of separation. The date of separation can itself become contentious, which is another reason to get advice early.
If you miss the applicable deadline, you will need the Court's permission to proceed out of time — and permission is not granted as a matter of course.
Formalising Your Agreement
Most property matters settle by negotiation or mediation rather than a contested hearing. But reaching an agreement is not the same as making it binding. A handshake, an email exchange, or even a signed letter between the two of you gives you very little protection if the other party changes their mind.
There are two ways to make a settlement enforceable:
- Consent Orders — your agreement is filed with the Federal Circuit and Family Court and sealed by a registrar. Once made, the orders are binding and enforceable in the same way as orders made after a hearing.
- A Binding Financial Agreement — a formal contract between the parties, made without going to court. Both parties must receive independent legal advice before signing, and an agreement that does not meet the statutory requirements can be set aside.
Which one suits depends on your circumstances. Either way, formalising the agreement is what converts a fragile understanding into certainty — and it is also what severs the financial relationship, so a former partner cannot come back years later with a claim.
How Purcell and Purcell Can Help
A property settlement is one of the most significant financial events in most people's lives, and the decisions made in the months after separation tend to be the ones that stick. Getting advice early means you understand your entitlements before you start negotiating, rather than discovering afterwards that you agreed to less than you should have.
Our family law team can advise you on where you stand, what the asset pool actually looks like, and how to formalise an agreement so it holds. We act for married and de facto couples across Werribee and the Wyndham region.
We offer a free 30-minute initial consultation for all family law matters. Call us on (03) 9741 3777 or book online to get started.