Superannuation assets increased 6.7% in aggregate in the year following March 2018 and were $2,782.6 billion at 31 March 2018.
When relationships breakdown, a couple’s superannuation entitlements form part of the property of parties to be considered for adjustment in a property settlement, and it is possible to split the superannuation entitlements of married and de facto couples as part of the property settlement. It is still not possible to split the superannuation entitlements of de facto couples in Western Australia, but proposals for legislative change have been announced.
Superannuation splits need to be the subject of a Court order or a Superannuation Agreement entered into strictly in accordance with the Family Law Act.
The nature and characteristics of the different funds- including SMSF, Industry Funds, Public and Private Sector schemes and Statutory Funds- are diverse and different rules apply to different types of funds. An example of this is adjustments made to base amounts split in favour of a non-member spouse (NMS) in a SMSF and in most Defined Benefit Funds.
When a super splitting order is served on the trustee of these funds, the trustee generally holds the base amount for payment to the NMS until the member satisfies a condition of release. In the interim, the trustee must add interest to the base amount pending payment in accordance with determinations of the Government Actuary. The Family Law (Superannuation) (Interest Rate for Adjustment Period) Determination 2019 was recently released and an interest rate of 4.8% per annum will be added to the relevant base amounts in the financial year beginning 1 July 2019.