Transferring property in a family law settlement (Queensland)

You need a formal agreement first

A verbal understanding, or even a signed letter between the two of you, is not enough. To transfer the property without duty and to bring the financial relationship to an end, the split needs to be recorded in one of two ways:

• Consent orders made by the Federal Circuit and Family Court — an application in proceedings signed by both parties, filed with a minute of the orders sought
• A binding financial agreement under the Family Law Act, with each party having independent legal advice certified on the document

The transfer duty exemption

Queensland's Duties Act exempts a transfer of matrimonial or de facto relationship property between the parties where it is made under a court order, consent order or a recognised binding financial agreement. That exemption is the reason the order of events matters: the formal document has to exist before the transfer is lodged, not after.

The exemption applies to transfers between the parties themselves. Transferring the property to a new partner, a company, a trust or an adult child as part of the settlement generally attracts full duty on the interest transferred, calculated on market value rather than on any nominal price recorded between you.

The mortgage is the real bottleneck

The bank is not bound by your consent orders. If the party keeping the house cannot refinance the loan into their sole name, the transfer cannot settle — the outgoing party stays on the mortgage and remains fully liable for it, no matter what the orders say between you.

Start the refinance application early and get an approval in principle before agreeing to firm dates. Where the retained equity is tight, it is better to know that before the orders are finalised than after.

What the transfer itself involves

Once the orders are made and finance is approved, the conveyancing side is fairly mechanical, but each step has to line up on the same day:

• Preparing the Form 1 transfer and the duty exemption documents with a certified copy of the sealed orders
• Verification of identity and right-to-deal for both parties, which is required even between separating spouses
• Coordinating the incoming lender, the outgoing lender's discharge and the electronic settlement workspace
• Adjusting council rates, water and body corporate levies to the transfer date if the orders provide for it
• Lodging the transfer and confirming the title has issued in the sole name

Points people miss

Two issues come up repeatedly and both cost money if they are left to the end:

• Capital gains tax — the main residence exemption may not cover an investment property or a portion of the ownership period. A rollover can apply to transfers under family law orders, but it defers the tax rather than removing it, so the party keeping the property inherits the CGT history
• Land tax and rates arrears — these follow the land, so the incoming owner should confirm the position before settlement
• Wills and enduring powers of attorney — separation does not revoke your will in Queensland, and divorce only partly affects it. Update both once the settlement is done
• Superannuation splits are a separate mechanism from the property transfer and need their own orders and fund paperwork

How we can help

We act on the conveyancing side of family law settlements across the Sunshine Coast and Moreton Bay. If you already have consent orders or a financial agreement from your family lawyer, we can take it from there and complete the transfer on a fixed fee. Call 0488 340 853 with a copy of the orders and we will tell you what it costs and how long it takes.

Family law property transfers in Queensland — common questions