For many clients, superannuation is now the biggest asset after the family home and any rental properties. Here are 4 key questions we deal with:  

Issue 1: Do I have to share my KiwiSaver superannuation with my partner?

Yes, if you contributed to the scheme after your relationship began, or you were entitled to a scheme because of your employment since your relationship began. In either case, the value added during the relationship is shared 50/50 as part of the relationship property. You or your lawyer will need proof of the value of the scheme at the relevant date, unless it is very small.   The value of the superannuation is either at the date of separation or the date of resolution. In my view, the date of resolution is the best time the value should be assessed. There are complications if you do not settle for some time after the separation date. We will assist with this.  

Issue 2: Can I withdraw my superannuation (including KiwiSaver)?

Grounds – Significant financial hardship and serious illness. If the superannuation trustees are reasonably satisfied that a member is suffering or is likely to suffer significant financial hardship, you may make a significant financial hardship withdrawal.   The trustees must be reasonably satisfied that reasonable alternative sources of funding have been explored and have been exhausted, and may direct that the amount withdrawn be limited to a specified amount that, in the trustees’ opinion, is required to alleviate the particular hardship.   “Significant financial hardship” includes significant financial difficulties.

The relevant ones for separation are:

  • A member’s inability to meet minimum living expenses;
  • A member’s inability to meet mortgage repayments on his or her principal family residence, resulting in the mortgagee seeking to enforce the mortgage on the residence.

We have had a number of clients withdraw their superannuation, including KiwiSaver, due to the grounds above. You will need to complete a statutory declaration of assets and liabilities.  

Issue 3: Can I withdraw my savings to buy a home?

If you have been a member of KiwiSaver for at least three years, you may be able to withdraw all, or part, of your savings to put towards buying your first home.   Eligible members can withdraw their KiwiSaver savings (including tax credits). This may help you get a deposit together with any relationship property settlement.  

However, at least $1,000 must remain in your KiwiSaver account.   You must intend to live in the property. It cannot be used to buy an investment property.  

Issue 4: Do I need to pay out for superannuation accrued before the relationship?

No, only that accrued during the relationship. A calculation can be done to assist with this.   

 


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