Financial disclosure in Australian family law

Financial disclosure plays a crucial role in ensuring transparency and fairness in the resolution of disputes related to property settlements, spousal maintenance, and child support. Financial disclosure requires parties involved in family law proceedings to provide full, frank and accurate information about their financial circumstances, including income and expenses, property, financial resources, superannuation entitlements, and liabilities, both within Australia and outside of Australia. This process is essential for parties to make informed decisions and determine a fair division of property and financial responsibilities.

The Federal Circuit and Family Court of Australia (Family Law) Rules 2021 outlines the ongoing duty of parties to make full and frank financial disclosure. The primary objective of financial disclosure is to establish the pool of assets available for distribution between the parties, to identify each party's available income, and to ensure that all relevant financial information is disclosed to the other party and to the court, to facilitate a fair and equitable resolution of the issues at hand.

Failing to provide accurate financial disclosure or attempting to conceal assets or income can significantly impact the process and outcome of family law proceedings. Non-disclosure or misleading financial information can lead to delays in the resolution of disputes, increased legal costs, and potential penalties imposed by the court against the party that did not comply with the duty of disclosure. An adverse influence can be made by the court against the party who failed to disclose fully and frankly. In some cases, non-disclosure can also result in agreements or court orders being set aside due to a lack of full and accurate financial information.

For further information on the consequences of non-disclosure, see our article.

To fulfill their duty of financial disclosure, parties are required to provide a range of documents and information to the other party and the court. This may include (and this list is not exhaustive):

• bank statements
• tax returns
• superannuation member statements
• pay slips
• company financial statements and company tax returns
• valuations of real estate or corporate entities
• details of any trusts, including trust deeds, financial statements, and trust tax returns
• details of any investments

Parties are also required to disclose any significant changes in their financial circumstances, such as new sources of income, assets, or liabilities. It is important to remember that the duty of disclosure is an ongoing one, until the conclusion of the property settlement.

Prior to the first court date, parties are required to file an undertaking that they have, to the best of their knowledge and ability, complied with the duty of disclosure set out in The Federal Circuit and Family Court of Australia (Family Law) Rules 2021, and acknowledging that a breach of the undertaking may be contempt of court.

In cases where one party suspects that the other party is not providing full and accurate financial disclosure, they can seek additional information through formal channels such as subpoenas, requests for financial records, or an application to the court for orders compelling disclosure. The court has the power to enforce compliance with the duty of disclosure and impose penalties for non-compliance to ensure that all relevant financial information is brought to light.

Transparency and honesty in financial disclosure are essential for achieving fair and just outcomes in family law disputes and ensuring that the interests of all parties are protected.

For more information on financial disclosure in family law proceedings, please contact a member of our experienced family and relationship law team.