Family lawyers in Sydney offer advice on credit card debts in family law disputes

1. ARE CREDIT CARD DEBTS TAKEN INTO ACCOUNT IN A PROPERTY SETTLEMENT?
2. IT WILL COME AS NO SURPRISE WHEN THE ANSWER IS “IT DEPENDS”

The Court will take into account:

1. Which party has the credit card debt and whether the debt was incurred
   • before the relationship commenced,
   • during the relationship, OR
   • after the relationship ended.

2. Why the credit card debt was incurred –

• For essential living expenses for both parties?
• essential living expenses for one party?
• for extravagant purchases?
• for non-essential purchases?
• to benefit another third party (for example, a new girlfriend/boyfriend)?
• the impact of the credit card debt on the net assets of the parties?

3. If the credit card debt was to pay tax liabilities, evidence will be needed, usually from ATO documents, on the amount, the type of tax; and whether it included penalties. If it was income tax, evidence of the financial years to which it related will be needed. Source documents relating to the computation of the tax should be disclosed.

A judge is given a discretion on how to treat a credit card debt, with the test basically whether or not the credit card debt was “unreasonably incurred”.

If you have questions on liabilities in family law property disputes, send an email to Kathy Chase at: pittwaterfamilylawyers@gmail.com Or telephone her on (02) 9918 6565 or 0418 285307. http://www.pittwaterfamilylawyers.com.au