Many Western Australian couples who ended their union due to irretrievable breakdown of marriage were grateful for the legal advice given by the Burra Robinson Family Lawyers.
Apparently, prior to getting married, the thankful couples sought the firm’s guidance in drawing up a legally binding prenuptial agreement that they could implement should they decide to get a divorce. Divorce proceedings as we all know it, include marital asset distribution.
The prenuptial agreement made it possible for the separating couples to keep their individual pre-marriage investments intact. The prenup not only protected the asset of each individual concerned but also gave clarity on what to consider as marital assets, subject to fair and equitable distribution.
Important Aspects About Prenuptial Agreements in Australia
First off, a prenuptial in Australia is similar to the prenups in other countries, but is more commonly known in the country as a Binding Financial Agreement (BFA). A BFA is a legally binding document that clearly states what the concerned couple acknowledges as marital assets. The agreement also states specifically how the marital assets will be divided between them in the event that their marital or de facto relationship fails and falls into a state of irretrievable breakdown.
In Western Australia (WA), the Family Law Act of 1975 and of 1997 amended the earlier existing Family Laws of the country by simplifying divorce proceedings as a no-fault relationship breakdown leading to divorce. Yet the Family Law Act of 1975 requires couples, including those in a de facto relationship, who are contemplating on dissolving their marriage, to first live apart for 12 months, before making a final decision to file for a divorce.
If the 12-month separation still leads to a divorce, then the prenuptial agreement will serve as guidelines in the distribution of the marital or conjugal assets.
Actually, a BFA is recommended to Australian couples in general, and not only among the rich Australian couples. Primarily because its goals are aligned with the Family Law Act 1975 and 1997, which aims to facilitate divorce proceedings in less time and at fewer costs.
More importantly, there are benefits to having a BFA. The BFA can be executed before, during or after the commencement of a marriage or a divorce proceeding as many eventually understood there are benefits to having a BFA in place:
Benefits of a BFA in Divorce Proceedings
Maintaining Privacy Over Sensitive Financial Matters – The preparation, deliberation, execution of a BFA can be completed privately to involve only the marrying or divorcing couples and their respective lawyers. This stands in contrast to entering a financial settlement agreement in the Family Court where nearly everyone who will stand as witnesses to both parties will hear and have knowledge about sensitive financial matters largely considered as private.
Avoidance of Prolonged and Costly Court Proceedings– Even if post-separation of marital properties takes place once divorce proceedings are underway in the Family Court, the existence of a BFA will make asset division and distribution much easier to accomplish. Personal assets of each individual are protected while prior agreement regarding division of conjugal assets will simply prevail.
Tax Benefits of BFA Ordered by an Australian Family Court – When the financial agreements contained in a DFA are ordered by an Australian Family Court , the separating couple will be entitled to receive stamp duty concessions. Additionally, it is also possible to just roll over the Capital Gains Tax should the settlement arise from a court order. However, the tax benefits do not apply to prenuptial agreements or BFAs that were privately discussed and executed outside of an Australian Family Court