Upon separating from their partner most people are aware of their obligations to pay Child Support for the financial maintenance of their children. However, many people often do not realise that they may also have an obligation to provide their ex-spouse with financial support in the form of “Spousal Maintenance”.
Spousal maintenance is the financial support of one spouse by the other spouse following the breakdown of a marriage or a de facto relationship.
Spousal maintenance is payable when:
- One party requires financial support (for example, the persons expenses are higher than their income); and
- The other party has the capacity to provide financial support (for example, once that person has met their own expenses they income left over to provide to the other party).
A spousal maintenance application will only be successful if both of the above criteria are proven. Therefore, if one party needs financial assistance but the other party is unable to provide financial assistance then the application will not be successful.
The Court will consider each parties income, standard of living and expenses when determining whether there is a ‘need’ and a ‘capacity to pay’.
When considering an application for spousal maintenance the Court will consider among other things:
- The age and health of each party;
- If a party is the primary caregiver of children of the relationship;
- The income and financial resources of the parties (any disparity between the parties’ income earning capacities or access to trust distributions or share dividends);
- The party’s ability to work (for example, does the person have any health issues? or is the person the primary caregiver of young children?); and
- A suitable standard of living (the lifestyle in which the person is accustomed will be considered).
Spousal maintenance can be paid in either a lump sum payment or in ongoing periodic payments. Most people elect to provide their ex-spouse with a lump sum payment as part of a legally binding property settlement to discharge their obligation and to avoid having to make ongoing weekly or fortnightly payments into the future. However there are important technicalities around the best way to make this legally binding so you are not hit with another application in a few year’s time because the first lump sum ‘ran out’.
There are time limits in place for filing spousal maintenance applications. For married couples you have 12 months from the date of your Divorce Order to file a spousal maintenance application. For de facto couples you have two (2) years from the date of your separation to file a spousal maintenance application.
If you are separating from your partner and are in need of some advice about your entitlement to receive spousal maintenance or your potential obligation to pay maintenance, please contact our experienced Family Law Team on (03) 9614 7111.