Many people understand, in a general way, that if they have been in a relationship for three years or more, that the property involved in that relationship is split 50/50 if the relationship ends. This also applies to entitlements to assets upon death.
But, what if you inherited some property? What happens to that?
What about the property that you have kept as separate assets?
What is you live in the inherited family home of one of the partners in the relationship?
What happens then?
The Property (Relationships) Amendment Act came into force in 2001. This outlines how things are split - and that three year time period is the magical number.
12 years later, we are starting to see some case law addressing the issues that arise. This excellent article by Diana Clement covers some of the issues that have arisen.
The most important thing for you - is that you deal with these questions. Seek expert advice to make sure that you get things right for yourself. This may be setting up a Family Trust arrangement, or having a Property Relationships Agreement. It may involve some other legal arrangements.
It can be difficult to deal with (just like making Wills), but it is important to sort out as soon as you can, so that you have some sort of certainty, that your wealth creation plans will not go totally awry if your relationship ends.
We have two lawyers that we highly recommend - if you would like a referral, email us at money@moneyworks.co.nz and we will send you the relevant information.
Splitting property not always straightforward - Diana Clement - New Zealand Herald
Other blog posts that you might find of interest are:
Insurance Cover and Policy Wording Passback – what does this mean?
This is my personal story too – Adriennes Disability Story
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By Carey Church
