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What Factors are Considered While Dividing the Assets When a Couple Divorces?

factors determining division of assets

If you are getting a divorce in Singapore and have not been able to come to an agreement with your spouse on property division, the Court determines the best way to do so.

To ensure a fair division of matrimonial assets, the Court considers multiple factors, including the length of the marriage, financial and non-financial contributions of each party as well as any agreement made between parties in contemplation of divorce.

Before exploring these factors, it is important to know what type of assets are considered matrimonial assets.

What counts as matrimonial assets?

Matrimonial assets are the assets that one or both partners own when married. The Women’s Charter defines them as assets-

  • acquired before marriage and were ordinarily used by both parties or children when residing together for transportation, shelter, recreational, social, educational, or aesthetic purposes or substantially improved in quality by either one of the parties during the marriage
  • acquired during the marriage by either one or both parties.

Typical matrimonial assets include bank savings, family cars, matrimonial home, paintings, jewellery, businesses, and the Central Provident Fund balance.

What will not count as matrimonial assets?

Assets acquired through inheritance or received as gifts that were not improved in quality during the marriage are not considered matrimonial assets. When it comes to gifts, two different scenarios are considered to determine whether they are matrimonial assets. For instance, if the husband gifts his wife a diamond necklace using a part of his inheritance, the necklace is not considered a matrimonial asset. If he buys the necklace using his own earned money, it is included in the matrimonial asset pool.

Factors courts consider for dividing matrimonial assets

Contributions: Courts look at both direct and indirect contributions made towards buying and maintaining an asset. Direct contributions are those that add value to the matrimonial asset in question. Examples of direct contributions include monthly loan payments or down payments made for a home or car.

If one of the parties has contributed to renovations of a property, for instance, it can also be considered as a direct contribution as it adds to the asset’s value.

Indirect contributions include indirect financial contributions such as taking care of household expenses and non-financial ones such as caring for the dependents. Dependents can include the elderly, children or infirmed family members.

Courts examine all the evidence that shows the direct contributions each party has made towards the asset. The evidence examined can include bank statements, CPF account statements, property-related bills and receipts.

When it comes to the HDB flat, the party who is the custodian of the child/children may keep the flat, as per the HDB policy. If the divorcing couple has no children, the owner of the flat, who is 35 years or more and is a Singapore citizen, may keep the flat. The flat should also have been occupied for a minimum period of five years.

Debts: Courts also look into the debts owed to determine the right way to divide matrimonial assets. Debts can range from credit card debts, loans to gambling debts. Joint debts taken for the family’s benefit, such as home renovation or mortgage, are the responsibility of both parties. Courts also consider individual debts incurred by one partner for their own benefit (such as gambling) when dividing assets.

Duration of the marriage: Indirect contributions generally tend to feature more prominently in long marriages.

Related Article: Indirect Contributions in Matrimonial Assets

The needs of the children/child: Courts consider the party who has been given custody, care, and control of the child while determining the child’s needs.

Related Article: Understanding Child Custody: Sole Custody & Joint Custody

>Pre and post-nuptial agreements: Courts will also consider the prenuptial or post-nuptial agreements the couple entered into before or during the marriage.

Related Article: Factors Influencing Division of Matrimonial Assets

Consult a Singapore divorce lawyer

Division of matrimonial assets may not always be a straightforward procedure in many cases. Situations such as co-owning more than one property, high-value assets, and debts can make the division of assets complex. A trusted Singapore divorce lawyer can help you understand the best way to protect your assets and your children’s interests.