Family Law Property Settlements - Stamp Duty Savings08-10-2021 | Resource | Simone Thomas
For many separating couples, especially when the break-up has been a mutual decision, there is a strong temptation to avoid the involvement of family lawyers and work out the division of their property themselves.
At Lamrocks we see a lot of couples who think that by simply agreeing between themselves who gets the house and the car, they can save the cost of a lawyer preparing a formal settlement agreement.
In the short term it seems reasonable. So why do we strongly recommend a formalised agreement?
In reality, it is very important for clients to understand that if they don't formalise their property settlement it can have negative consequences down the track. Aside from preventing future disagreements, or one party deciding to try and re-negotiate at a later stage, a formal property settlement can also have significant benefits from a taxation and Stamp Duty perspective.
For example, if a couple owns a home together and decides to transfer it from joint names into one party's name only, or from one party to the other, they will receive an exemption from Stamp Duty on the transfer IF the transfer occurs as part of a formal property settlement. This means that the relatively small cost of producing a formal property agreement could save tens of thousands of dollars in Stamp Duty on the transfer of a home! To ensure you benefit from any Stamp Duty relief or taxation benefits, you must formalise your property settlement either through the use of consent orders or a Binding Financial Agreement. These documents are best prepared by a solicitor with expertise in the field of family law to ensure that they are prepared correctly, and that they do not leave any room for ambiguity or potential disputes in the future.
If you are separating, speak to a Lamrocks family lawyer today for advice on how you might be able to structure and formalise your property settlement to your advantage.