Calculation of family law splits for MilitarySuper
Understand the effect and calculation of a family law split on your benefit.
Disclaimer
The following information is provided as an explanation of how family law splits are calculated and applied to a member’s benefit. Each individual’s circumstances are unique. This information should not be relied upon for making decisions regarding your family law matter. Prior to making any decisions about splitting your superannuation or family law matter, you should consider seeking independent legal advice and or financial advice.
Please note this information only applies for MilitarySuper fund.
How is my family law split calculated?
The effect and calculation of the family law split on your benefit will depend on whether it is in the contributing, preserved or pension phase.
This section contains:
Contributing and Preserved Benefit
Base Amount Split
The first step to applying a split is to calculate the value of a member’s benefit. This is different to the equity that is displayed on a member’s statement. The values used to calculate a split of a benefit are specific to family law matters. A member’s statement will not be used to determine the value of a benefit for family law purposes.
You can request a Form 6 Application for Superannuation Information, the response to which can be taken to an actuary, financial planner or your legal representative who will be able calculate the value of the benefit for family law purposes.
Example
Meet David. David is going to demonstrate how this applied to him and his family law matter. David is a MilitarySuper member and holds both contributing and preserved benefits. After his family law matter is finalised through the Federal Circuit and Family Law Court, David serves a copy of the Court Order on CSC. This Court Order states that David’s ex-spouse Sarah is to be allocated a Base Amount of $200,000 out of David’s benefit, calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2025. The date of effect for this split, known as the ‘Operative Time’ is four business days after service. David served the Order on CSC on Monday, 1 July, so the Operative Time is Friday, 6 July. At the Operative Time David had served 14 complete years of service and was 43 years and 7 months old. His rank at the time was Sergeant, and the rank relating to his preserved benefit was Corporal. The first step to applying the split to David’s benefit is to calculate the value of his benefit. This is different to the equity that is found on his member statement. The values that are calculated to split the benefit are specific to family law matters. |
Valuing the Benefit
Two values are calculated at the Operative Time—these are the Family Law Value & the Scheme Value.
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Back to David. David’s benefit components at the Operative Time were:
*The employer benefit is the total employer benefit, as calculated by Average Salary (AS) x Employer Benefit Multiple (EBM). This includes the productivity benefit. Therefore, the total equity is the total of Employer Benefit, Preserved Unfunded Employer, Preserved Funded Productivity, Member and Ancillary. |
Family Law Value
To calculate the Family Law Value, factors are applied to each component of a benefit. These factors applied to a split are individual and are reflective of length of service in complete years, age in years and months, sex and rank.
The value of each of these components is added together to get the total Family Law Value.
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Based on David’s length of service in complete years, age in years and months, sex and rank this is $537,529.51.
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Scheme Value
The same method is used to calculate the Scheme Value. However, different factors are applied. The value of each of these components are added together to get the total Scheme Value.
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Based on David’s length of service in complete years, age in years and months, sex and rank this is $622,113.14.
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It is important to note that the Family Law and Scheme values may differ to a member’s actual equity. It is possible for both or either of the values to be higher or lower than a member’s actual equity.
Calculating Associate Benefit
To work out the starting value of the Associate Benefit, the Transfer Amount must be calculated. The Transfer Amount is calculated in reference to the Base Amount stated within the Court Order. In splits where the Family Law Value is the same or higher than Scheme Value, the Transfer Amount will equal the Base Amount.
In splits where the Scheme Value is higher than the Family Law value, the Transfer Amount will be higher than the Base Amount. This is to ensure the Transfer Amount reflects the same proportion of the Scheme Value as the Base Amount does of the Family Law Value.
For example if the Scheme Value is higher, the Transfer Amount is calculated using the formula below:
| Transfer Amount | = | (Scheme Value – Surcharge Debt) | x | ( | Whole dollars in base amount | ) |
| Whole dollars in Family Law Value |
This formula increases the Base Amount by the same proportion that the Scheme Value is higher than the Family Law Value. For instance, if the Scheme value is 15% higher than the Family Law value, the Transfer Amount will be 15% higher than the Base Amount.
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David’s split will look like this:
Transfer Amount = $231,471.47 |
Reduction of Member’s Benefit
To work out the reduction of the member’s benefit, we need to first work out the Reduction Factor. This is calculated using the following formula:
| Reduction Factor | = | ( | Scheme Value + Surcharge Debt – Transfer Amount | ) |
| Scheme Value + Surcharge Debt |
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Applying this to David's scenario:
Reduction Factor = 0.627927 |
This Reduction Factor is then applied to all components of the member’s benefit. The Reduction Factor is the amount that the component is multiplied by to get the post-split values, rather than the reduction amount.
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In David’s case, the actual reduction to his benefit is $216,062.76. This is more than the Base Amount stated, but less than the Transfer Amount paid to his ex-spouse, Sarah.
*The employer benefit is the total employer benefit, as calculated by Average Salary (AS) x Employer Benefit Multiple (EBM). This includes the productivity benefit. Therefore, the total equity is the total of Employer Benefit, Preserved Unfunded Employer, Preserved Funded Productivity, Member and Ancillary. |
Please note that depending on each member’s unique circumstances, the reduction to their benefit may be more or less than the Base Amount or Transfer Amount.
Reducing the Employer Benefit Multiple
The total employer benefit for a MilitarySuper member is calculated by multiplying their Average Salary (AS) by their Employer Benefit Multiple (EBM). For more information on this calculation, see MilitarySuper.
It is not possible to reduce a member’s salary, so the EBM must be reduced instead. This is done by applying the reduction factor to the EBM. The reduced EBM is calculated using the members EBM effective at the Operative Time and Reduction Factor:
Reduced EBM = EBM x Reduction Factor
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David’s EBM at the Operative Time is 3.64941176 and the Reduction Factor is 0.627927. Reduced EBM = 3.64941176 x 0.627927 Reduced EBM = 2.29156418 |
The reduced Employer Benefit is calculated using the reduced EBM and the Average Salary at the Operative Time:
Reduced Employer Benefit = Reduced EBM x Average Salary
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At the Operative Time, David's Average Salary is $85,000 Reduced Employer Benefit =2.29156418 x $85,000 Reduced Employer Benefit = $194,782.96 |
As a result of the Family Law Split there will be a permanent reduction to the members EBM. This will impact the superannuation benefit payable to the member when they claim their benefit. A member's EBM will continue to grow at the rate dependent on their length of service.
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For David this means his EBM will be reduced by 1.35784758 (3.64941176 – 2.29156437). David’s EBM will continue to grow at the rate dependent on his length of service. |
Pension and Preserved Benefit
Base Amount Split
Background
The first step to applying the split to a member’s benefit is to calculate the value of their benefit. This is different to the equity that is found on a member statement, and different to the Transfer Balance Cap. The values that are calculated are specific to family law matters.
Valuing Pension and Preserved Benefit
Two values are calculated at the Operative Time —the Family Law Value and the Scheme Value. The values for the Pension and Preserved benefits are initially calculated separately.
Example
Helen is a MilitarySuper member and has both pension and preserved benefits. Helen and her ex-spouse, Mark, come to an agreement about how to split Helen’s superannuation and Helen serves a copy of the signed Superannuation Agreement on CSC. This Agreement states that Mark is to be allocated a Base Amount of $100,000.00 out of Helen’s benefit, calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2025. The date of effect for this split, known as the ‘Operative Time’ is four business days after service. Helen served the Agreement on 01 July, so the Operative Time is 6 July. At the Operative Time, Helen was 48 years and 6 months old. Her rank relating to her preserved benefit was Lieutenant and her pension is being paid due to medical transition. Helen’s annual gross pension at the Operative Time is $18,000.00. Helen’s preserved benefit components at the Operative Time:
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Family Law Value
To calculate the Family Law Values for the pension component, factors are applied to each component of the benefit. These factors are based on Helen’s type of pension, age in years and months, and sex. The value of each of the pension components is then added together to get the total pension Family Law Value.
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For Helen this is $277,232.54.
*Annual reversionary is calculated by multiplying the annual gross pension amount by 0.67. See Death benefits for more information on reversionary pensions. |
To calculate the Family Law Values for the preserved component, factors are applied to each component of the benefit. For the member and ancillary components, the factor is always 1.
The value of each of the preserved components is then added together to get the total preserved Family Law Value.
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For Helen this is $90,000.00.
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Scheme Value
The same methods are used to calculate the Scheme Value. However, different factors are used. See the MSBS Actuary methodology factsheet for more information on Scheme Value factors.
Pension: |
Component |
| Annual Gross Pension | |
| Annual Reversionary* |
*Annual reversionary is calculated by multiplying the annual gross pension amount by 0.67. See the death benefits factsheet for more information on reversionary pensions.
The value of each of the pension components is then added together to get the total pension Scheme Value.
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For Helen this is $294,758.82.
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Preserved: |
Component |
Factor |
| Member | 1 | |
| Ancillary | 1 |
The value of each of the pension components is then added together to get the total pension Scheme Value.
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For Helen this is $90,000.00.
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Proportioning the Base Amount
For members who hold both pension and preserved benefits, the Base Amount needs to be applied proportionally across the two benefits. This is done by first working out how much of the total value the pension and preserved components make up.
Total Family Law Value = Pension Family Law Value + Preserved Family Law Value
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Looking back at Helen:
Total Family Law Value = $367,232.54 Of the total Family Law Value, the pension makes up 75.49% ($277,232.54 ÷ $367,232.54) and the preserved benefit makes up 24.51% ($90,000.00 ÷ $367,232.54). Therefore, 75.49% of the Base Amount is allocated to the pension, and 24.51% is allocated to the preserved benefit. |
Proportioned Base Amount = Proportion of Total Family Law Value x Base Amount
Pension Base Amount = $75.492.37
Pension Base Amount = $24,507.63 |
Calculating the Associate Benefit
To work out the starting value of the Associate Benefit, the Transfer Amount must be calculated. The Transfer Amount is calculated in reference to the Base Amount stated in the Agreement or Court orders.
In splits where the Family Law Value is the same or higher than the Scheme Value, the Transfer Amount will equal the Base Amount.
In splits where the Scheme Value is higher than the Family Law value, the Transfer Amount will be higher than the Base Amount. This is to ensure that the Transfer Amount reflects the same proportion of the Scheme Value as the Base Amount does of the Family Law Value.
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The pension Transfer Amount is calculated using the formula:
| Pension Transfer Amount | = | (Scheme Value) | x | ( | Whole dollars in Pension base amount | ) |
| Whole dollars in Pension Family Law Value |
This formula increases the Base Amount by the same proportion that the Scheme Value is higher than the Family Law Value. For instance, if the Scheme value is 15% higher than the Family Law value, the Transfer amount will be 15% higher than the Base Amount.
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For Helen’s pension split:
Pension Transfer Amount = $80,264.90 |
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For Helen’s split, the Family Law and Scheme Values are the same for the preserved benefit. Therefore, the preserved Transfer Amount equals the Base Amount: Preserved Transfer Amount = Preserved Base Amount Preserved Base Amount = $24,507.63 |
Reducing the Member’s Benefit
To work out the reduction of a member’s benefit, we need to first work out the reduction factor.
Pension benefit
For the pension benefit, this is calculated using the following formula:
| Reduction Factor | = | ( | Scheme Value – Transfer Value | ) |
| Scheme Value |
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For Helen:
Pension Transfer Amount = 0.727693 |
For pension & preserved splits, the reduction factor will be the same, bar rounding.
The reduction factor is then applied to the member’s annual pension:
Reduced Pension = Gross Annual Pension x Reduction Factor
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For Helen: Reduced Pension = $18,000 x 0.727693 Reduced Pension = $13,098.47 |
Preserved Benefit
For the preserved benefit, the Family Law Value is the same as the Scheme Value, so the reduction is calculated using the following formula:
| Reduction Factor | = | ( | Family Law Value + Surcharge Debt – Transfer Amount | ) |
| Family Law Value + Surcharge Debt |
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For Helen:
Reduction Factor = 0.727693 |
Helen does not have any surcharge debt.
This reduction factor is then applied to all components of the benefit. The reduction factor is the amount that the component is multiplied by to get the post-split values, rather than the reduction amount.
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Helen's post-split values will be:
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Downloads
MilitarySuper Death and Invalidity
This document outlines information on MilitarySuper death and invalidity entitlements. It forms part of the MilitarySuper Product Disclosure statement.
Actuary's Methodology for MilitarySuper Family Law
This publication details the adjustment of benefits following family law splits for MilitarySuper.
MilitarySuper Pension Factors
MilitarySuper Pension Factors
Family law and splitting super
This booklet is designed to give you a step by step guide to how the superannuation splitting process works.
MilitarySuper Other Than Officers Employer Benefit Factors
MilitarySuper Other Than Officers Employer Benefit Factors
MilitarySuper Preservation Scheme Factors
MilitarySuper Preservation Scheme Factors