Divorce & Property: Is the House You “Own” Actually Yours?

It’s common for parents to help adult children buy property. But if a relationship breaks down, is that property included in the marital asset pool? Not always. Courts look past the name on title to who beneficially owns the property.

A real-world scenario (simplified)

• Title in the wife’s name.
• The wife’s elderly mother paid the full purchase price and outgoings.
• Earlier family properties were also held in the daughter’s name, yet sale proceeds always reverted to the parents.
• Renovations were paid for by the mother; the husband’s evidence of contribution was inconsistent.

What the Court cared about

• Intention at purchase: Did the parents intend to gift a beneficial interest to their child—or to retain it?
• Who paid what, and when: Purchase monies, rates, and renovations.
• Pattern of behaviour: Where earlier properties in the child’s name were always treated as the parents’ assets.
• Consistent evidence: Clear conversations and documents beat inconsistent recollections.

Key concepts in plain English

Legal vs beneficial ownership
Your name on title is legal ownership. Courts can still find someone else is the beneficial owner.

Held ‘on trust’
If you hold property for someone else’s benefit, you may be a trustee—even without a formal trust deed.

Resulting/constructive trusts (high level)
Where contribution and intention point to someone else being the true owner, a trust may be inferred or imposed.

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What this means for couples (and parents)

Title alone isn’t decisive. Courts can exclude property from the pool if a spouse is only a bare trustee.

Document the intention. If parents mean it as a loan or that they retain ownership, paper it properly up-front. See our guide to family loans vs gifts.

Expect scrutiny of evidence. Bank trails, rates notices, renovation invoices, and consistent past practice all matter.

Tax and duty still exist. Trusts and transfers can trigger CGT, land tax, or duty consequences—get integrated legal-tax advice before you move anything.

How The Quinn Group helps

As an integrated legal and tax team, we:

• Review title, source of funds and documents to assess beneficial ownership risk.
• Prepare robust loan or trust documentation so intentions are clear.
• Coordinate family law, tax and duty implications for any restructure or settlement.
• Represent you in negotiations and act as with counsel if court action is required.

NEED HELP? This article provides general information and should not be considered legal or tax advice. For personalised guidance, please contact our expert team of tax accountants at The Quinn Group by calling 1300 QUINNS (1300 784 667) or +61 2 9223 9166, or submit an online enquiry form to arrange an appointment.