Terms used in superannuation splitting

Accumulation interest

An accumulation interest is the most common type of superannuation interest. In an accumulation interest, money grows or ‘accumulates’ over time, and a member can access it when they retire. The money in the account for an accumulation interest is made up of both:

• the money that the member and the employer put into it
• the investment return generated after fees and costs.

The value of an accumulation interest is the amount shown on a member statement.
 

Accumulation interest (partially vested)

A partially vested accumulation interest includes an ‘accumulated’ amount of funds that the member can access at retirement, plus an extra amount that the member will receive if they take certain actions, such as staying with the same employer for a minimum number of years.
 

Defined benefit interest

A defined benefit interest pays benefits at retirement that are determined by a formula, unlike an accumulation interest that is based on contributions and investment returns. The formula usually includes things like the number of years the member worked for the employer and their average salary before they retired.
 

Growth phase

A superannuation interest is in the growth phase if the member spouse has not yet reached a relevant condition of release, or if they have reached a relevant condition of release but have not taken deliberate steps to access a payment. If an interest is not in the growth phase, it is in the payment phase.
 

Interest splitting

If there is a superannuation agreement or court order in place, in some circumstances the trustee can create a new superannuation interest for the non-member spouse right away. This is known as interest splitting.

It may be a new interest with the same superannuation trustee. Alternatively, if the non-member spouse already has a superannuation interest, it may be possible for their entitlement to be rolled over or transferred to that existing interest.

Trustees of accumulation interests and certain kinds of pensions with account balances must split interest under other superannuation laws (outside of family law). Trustees of some defined benefit interests may choose to split interest where the rules of the fund allow it.

When an interest is split, the superannuation agreement or court order is implemented immediately. No payment splitting needs to happen once the member spouse retires.
 

Member spouse

The member spouse is the person who holds the superannuation interest.
 

Non-member spouse

The non-member spouse is the spouse, former spouse, current de facto partner, or former de facto partner of the member spouse. 
 

Payment phase

A superannuation interest is in the payment phase if the member spouse has reached a relevant condition of release and has taken deliberate steps to access a payment from the interest. This means it is not in the growth phase.
 

Payment splitting

Under superannuation splitting laws, an agreement or court order to split superannuation is actually an agreement or order to split payments from a superannuation interest. The agreement or order operates so that whenever a payment from a superannuation interest becomes payable to the member spouse – when they reach a relevant condition of release, which is usually when they retire – a certain amount of that payment will be given to the non-member spouse.

Payment splitting does not create a new superannuation interest for the non-member spouse.
 

Percentage-only interest

Interests in specific superannuation plans, and all interests in superannuation annuities, are prescribed by the Family Law (Superannuation) Regulations 2025 as ‘percentage-only interests’. This means they can only be split by reference to a percentage, and not by reference to a dollar figure (known as a ‘base amount’).
 

Relevant condition of release

A member cannot access payments from a superannuation interest until they reach a ‘condition of release’. The most common condition of release for family law purposes is retirement from the paid workforce. Other conditions of release for family law purposes include permanent invalidity, terminal illness and death.

There are also other conditions of release, defined in superannuation legislation, that are not relevant for family law superannuation splitting. For example, if a member receives a superannuation payment because of temporary financial hardship, this payment will not be a splittable payment under a superannuation agreement or court order.
 

Self-managed superannuation fund

A self-managed superannuation fund allows members to manage their own superannuation and choose their own investments, rather than using a larger superannuation fund. Self-managed superannuation funds must have no more than 6 members, and must meet several specific conditions.

As with other superannuation interests, superannuation in a self-managed superannuation fund can be split under a superannuation agreement or court orders.
 

Separation declaration

A separation declaration is a formal written declaration that a couple has separated. It must be included in a superannuation agreement for the agreement to be implemented.

A couple may make a superannuation agreement at any time before or during a marriage or de facto relationship, or after a marriage or de facto relationship has broken down. When a couple, or one member of the couple, wants the agreement to be implemented, they must make a separation declaration and give it to the superannuation trustee.

The separation declaration must be signed no more than 28 days before it is given to the trustee.
 

Splittable payment

A splittable payment is a payment from a superannuation interest that will be split in accordance with a superannuation agreement or splitting order.

Most of the payments paid to the member spouse in respect of a superannuation interest are splittable. However, some payments are not. For example, payments made on compassionate grounds because of severe financial hardship are not splittable. Neither are short-term pension payments made as a result of temporary ill health.
 

Superannuation annuity

A superannuation annuity is a contract issued by a life insurance company or certain registered organisations to pay an income stream to the member during their retirement. These contracts are superannuation-like products, and many are purchased out of rolled-over superannuation amounts. Interests in all superannuation annuities are prescribed as percentage-only interests by the Family Law (Superannuation) Regulations 2025.
 

Superannuation annuity - deferred annuity 

A superannuation annuity that is not yet making income stream payments to the member is a deferred annuity.
 

Superannuation interest

A superannuation interest is a right to benefits (money) that you have accrued while you’re working, that you can only get when you retire. Until you retire, the benefits are held on your behalf by a superannuation fund, who has the role of trustee.
 

Superannuation trustee

A superannuation trustee is the person or organisation responsible for managing and administering a superannuation plan.