Key Takeaways
- Australian courts can include overseas assets in family law property settlements under the Family Law Act.
- You must provide full and frank disclosure of every overseas asset to avoid legal consequences.
- Valuation, tax implications, and enforceability vary across jurisdictions—seek expert advice in both countries.
- Australian orders may account for overseas assets even if not enforceable abroad.
Inclusion Under Australian Law
Under the Family Law Act 1975, Australian courts can exercise jurisdiction over assets that are held overseas, as long as the parties have a sufficient connection to Australia. Overseas property, bank accounts, shareholdings, pensions or business interests are all considered part of the divisible property pool.
Duty of Full Disclosure
When commencing property settlement proceedings, all assets—domestic and international—must be fully disclosed under Rule 6.06 of the Family Law Rules. Failure to disclose overseas assets risks:
- Penalties and adverse inferences
- Loss of credibility in court
- Payment of the other party’s legal costs
- More liberal court adjustments to compensate the innocent party
- Reopening of concluded settlements
Valuing Overseas Assets
Valuation can be challenging due to foreign market conditions, currency exchange rates, and differing legal systems. Courts may rely on expert valuations from professionals located in the relevant country. Agreeing on valuation methods or appointing a mutually accepted independent expert helps ensure transparency and fairness.
Tax and Financial Implications
It’s crucial to consider tax consequences in both Australia and the country where the overseas asset is located. For example:
- Capital Gains Tax (CGT) may apply to the same asset in both jurisdictions
- Exchange rate movements can distort the true net value of the asset
Engaging cross-border legal and tax experts can help you accurately reflect net asset values and structure settlements more effectively.
Enforceability of Australian Orders Overseas
While Australian courts have the power to make orders relating to overseas assets, enforcement depends on the foreign court recognising those orders. In many jurisdictions, foreign (Australian) court orders may not be enforceable as a matter of domestic law.
In such cases, Australian courts often make orders for the overseas asset to remain with the party who legally owns it, treating that as part of that party’s share of the total asset pool—including both Australian and overseas assets.
Practical Strategies and Checklist
- List all overseas assets, including real estate, bank accounts, shares, pensions, and businesses
- Engage valuation and tax professionals in the countries where the assets are located
- Ensure you understand and comply with disclosure obligations early in the process
- Consider freezing orders or injunctions if there’s a risk of asset dissipation
- Decide whether to treat overseas assets as part of a global pool or deal with them separately
- Account for enforceability issues before drafting or proposing any property orders
How CK Lawyers Can Help
CK Lawyers in Parramatta can assist you with all aspects of handling overseas assets in family law matters, including:
- Coordinating full and frank disclosure of international holdings
- Arranging valuations and liaising with foreign professionals
- Advising on the pros and cons of Australian versus foreign jurisdictional strategies
- Drafting Consent Orders or Binding Financial Agreements to reflect overseas holdings
- Planning enforcement strategies in foreign jurisdictions where necessary
- Managing cross-border tax and compliance risks
Conclusion
Overseas assets add a layer of complexity to property settlements under Australian family law. With the right legal strategy, expert valuation, and jurisdictional awareness, a fair and enforceable outcome is possible.
Contact CK Lawyers today to receive tailored legal support for property settlements involving overseas assets.
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