• Agreements the rollover applies to

    The rollover doesn't apply if you and your spouse divide your property under a private or informal agreement (that is, not one of the court orders, formal agreements or awards described below).

    The rollover applies to CGT events that happen because of either:

    • an order of a court or a court order made by consent under the Family Law Act 1975, or a similar law of a foreign country
    • a court order under a state, territory or foreign law relating to breakdown of relationship between spouses.

    The rollover also applies to CGT events that happen after 12 December 2006 because of one of the following:

    • a financial agreement that is binding under section 90G of the Family Law Act 1975 (known as a ‘binding financial agreement’) or a corresponding written agreement that is binding because of a corresponding foreign law
      • from 1 March 2009 the rollover also applies where a financial agreement is binding because of section 90UJ of the Family Law Act 1975 (which relates to agreements between de facto partners) or a corresponding written agreement that is binding because of a corresponding foreign law
       
    • an award made in an arbitration referred to in section 13H of the Family Law Act 1975 (known as an ‘arbitral award’) or a similar award under a corresponding state, territory or foreign law – such as an award made under the Western Australian Family Court Act 1997
    • a written agreement that is binding because of a state, territory or foreign law relating to breakdown of relationship between spouses and that, because of such a law, prevents a court from making an order:
      • about matters to which the agreement applies
      • that is inconsistent with the terms of the agreement, in relation to those matters, unless the agreement is varied or set aside.
       

    These are referred to as ‘binding agreements used by separating couples'. The following agreements meet these requirements:

    • a domestic relationship agreement or termination agreement that complies with subsection 47(1) of the New South Wales Property (Relationships) Act 1984
    • a recognised agreement within the meaning of the Queensland Property Law Act 1974
    • a cohabitation agreement that is a certificated agreement within the meaning of the South Australian's Domestic Partner Property Act 1996
    • a personal relationship agreement or separation agreement that complies with subsection 62(1) of the Tasmanian Relationships Act 2003
    • a financial agreement that complies with subsection 205ZS(1) of the Western Australian Family Court Act 1997
    • a domestic relationship agreement or termination agreement that complies with subsection 33(1) of the Australian Capital Territory’s Domestic Relationships Act 1994
    • a cohabitation agreement or separation agreement that complies with subsection 45(2) of the Northern Territory’s De Facto Relationships Act
    • a relationship agreement that complies with subsections 59(1) and (2) of the Victorian Relationships Act 2008 (which came into effect on 1 December 2008).

    From 1 July 2009 the marriage or relationship breakdown rollover is extended to same-sex couples.

    Agreements that do not require court intervention

    For transfers that happen because of a binding financial agreement or a binding agreement used by a separating couple, rollover only applies if at the time of the transfer:

    • the spouses involved are separated
    • there is no reasonable likelihood of cohabitation being resumed
    • the transfer happened for reasons directly connected with the breakdown of the marriage or relationship.

    The transfer may not be 'directly connected with the breakdown' if, for example:

    • the spouses had an agreement before the breakdown of their marriage or relationship stating that the particular property was to be transferred between them for other reasons not directly related to the marriage or relationship breakdown, or
    • the agreement provided for the transfer of non-specific property, the transfer does not occur for a considerable time (say, more than 12 months) after the agreement, and there are factors that suggest the transfer was not directly connected to the marriage or relationship breakdown.

    Next steps:

    Last modified: 17 Jul 2017QC 52252