What is marital property in a divorce?
The MPA describes matrimonial property as that which was acquired by either spouse, or jointly, during the marriage or after separation. Matrimonial property, which also includes debts, will be divided equally between the divorcing spouses unless special circumstances make an equal division unfair.
Are property settlements in divorce taxable?
This means that the spouse to whom the asset was transferred will be liable to pay the tax on any gain made on a subsequent sale of the asset. It is not just real estate that may be subject to tax upon sale or transfer. It includes other assets such as shares, leases and rights of various kinds.
Do you pay capital gains tax on divorce settlements?
CGT is only payable upon the trigger of a CGT event, such as a sale or transfer of the asset. An order from the Family Court or a Binding Financial Agreement provides CGT rollover relief so CGT is not payable when the property is transferred to one party by way of final settlement.