Income & spending after separation – how does it work?

Jun 7, 2022

So how does your income and spending after you have separated affect a property settlement?

It’s common for people who have separated from their married or de facto partner to take the view that what income they earn and spending they do after they have separated is no business of their ex-partner.   While it is understandable that separated couples might take this view it is, in fact, not correct.

From the time you separate until the time you have a formal property settlement in place between you and your ex, all your income and spending, inheritances, winnings, possessions and other matters which arise after separation, will be taken into account when it comes to determining what is a fair and equitable property settlement between the two separated parties.

All such matters are required by law to be fully and frankly disclosed between the parties when a property settlement is being determined. So yes, all those things which you might think are now your private business will continue to be the business of your ex-wife/husband or ex-partner until there is a property settlement between you.  This is because the law states that not only contributions made during the relationship, but also contributions made after the relationship ended – but before any property settlement – are to be taken into account when deciding a fair property settlement.

We strongly recommend that you, sooner rather than later, after separation seek legal advice and take steps to get a property settlement in place.

Why is this?

The longer you wait, then potentially, the more complicated it becomes to decide what a fair and equitable settlement might be.

Here a number of reasons why that might be the case:

  • Since separation, parent A has continued to work only a few hours a week because following separation they had the ongoing primary care of the children, so their income since separation has been significantly lower than parent B.
  • Parent B has continued to work full-time since separation and has been promoted. Parent B has not only earnt far more than parent A since separation, but has also earned far more per year than he/she ever earnt during the relationship.
  • Contributions made by either parent to home-making and/or to the care and welfare of the family after separation, which meant reduced employment hours due to those obligations, are recognised as being equally significant and relevant in a property settlement as contributions of income earning. Therefore, the home-making and child-care contributions of one party need to be balanced against the income earning activities of the other party. Make sense?  If parent A couldn’t earn as much income as parent B because they were home taking care of the children, then parent B is considered to have contributed to the after-separation earnings by caring for children.
  • Houses, cars, lottery wins, pay-outs and other assets acquired by one party after separation, but before a property settlement is in place, will be taken into account in determining what is a fair settlement and there will likely need to be an examination of the source of funds used to buy those assets.

We can help you with your property settlement at any time after you have separated, but we strongly recommend that you at least get some preliminary legal advice about your rights, entitlements and obligations regarding a property settlement sooner after separation rather than later.

If you have separated but don’t yet have a property settlement in place, or are having discussions with your ex-partner about a potential settlement, we invite you to take advantage of our free first interview where we will explain in more detail the matters relevant to a property settlement and the options available to you.


CAUTION: This article contains general information of public interest only and is not intended to be, nor should be relied upon, as legal advice specific to the reader’s personal circumstances. Should you have a legal matter, please seek professional advice before acting or relying on this content.