There are many factors to consider when it comes time to divide property during a separation or divorce. At Lowther Family Law, serving clients throughout British Columbia, we'll help you understand your situation. You can learn more about the topic on this page, or contact us directly to schedule an initial consultation.
Division of Property
The new Family Law Act of BC (FLA) provides for the division of a family's assets. The division takes place upon a divorce, annulment or declaration by a court that there is no reasonable prospect reconciliation between the parties.
So what are family assets? They are defined as those assets which are owned by either spouse, and which are ordinarily used for a family purpose. This can include the family home, car, art, recreational property and so on. Family assets also include Tax Free Savings Accounts (TFSAs), pension plans and Registered Retirement Savings Plans (RRSPs).
The division of property under the Family Law Act of BC is an equal division. However, but the court has the power to change this division. The court can consider the length of the marriage, whether property was acquired by inheritance or gift before the marriage, the needs of each spouse and whether one spouse has the responsibility to provide a home for any children that were a product of the marriage. The court may also consider the needs of one spouse to remain financially independent.
The division of property can take place by either selling the property and dividing the proceeds or by the court ordering that one spouse may keep the property upon paying compensation to the other spouse. See our section on Pension Division for more information.
Business assets held by one spouse can be considered as family assets if the other spouse made a direct or indirect contribution by way of effective household management and child-rearing responsibilities.
In the case of RRSPs, the Income Tax Act provides for a "rollover" permitting RRSPs to be transferred from one spouse to the other, without income tax becoming payable. However, a court order or written separation agreement is required by Revenue Canada. It is always best to obtain legal advice when substantial assets are involved.
Ultimately, it is only the Supreme Court which has the jurisdiction to deal with the division of family property. Be sure to familiarize yourself with the divorce court process.
Note: The information provided above is general information only and is provided as a public service. For detailed information and advice with respect to your specific circumstances, please contact our office for an appointment.