Debts incurred after separation but before divorce Australia can still be considered joint liabilities, depending on the circumstances surrounding the debt, the intent behind it, and how it fits into the overall asset pool.
If you’re navigating a property settlement, it’s important to know that debts taken on post-separation may still impact your financial outcome—regardless of who technically accrued them.
Key Takeaway: Just because you’ve separated doesn’t mean you’re automatically protected from debts your ex takes on. Timing alone doesn’t decide liability.
Are Post-Separation Debts Shared in Divorce?
In Australian family law, the Family Court treats both assets and debts acquired before, during, and even after separation as part of the property pool.
This means if your ex-partner racks up debt before the divorce is finalised, it might still affect your financial settlement. The Court examines whether the debt was:
- Incurred for the benefit of both parties or the family (e.g. mortgage, school fees)
- Personal in nature (e.g. gambling debts, extravagant personal spending)
- Necessary or reckless
Your involvement in or awareness of the debt can also influence how it’s treated. If you had no knowledge of the debt and it wasn’t for joint benefit, you may argue it should not be included.
Key Takeaway: Post-separation debts aren’t automatically excluded—context matters. If it benefited the family or shared responsibilities, you may still be on the hook.
Factors the Court Considers in Debt Division
The Court applies a four-step process when deciding on property and debt division. The presence of debts doesn’t change this, but they do form part of the liability assessment. Here’s what the Court evaluates:
- Asset and liability identification – all property and debt, including post-separation debt, is documented.
- Contributions – both financial and non-financial, during and after the relationship.
- Future needs – considering factors like age, health, earning capacity, and care of children.
- Just and equitable division – ensuring the outcome is fair to both.
If you believe a debt should be excluded, you’ll need to present evidence showing why it’s not shared or relevant to the joint asset pool.
Key Takeaway: Your financial protection lies in proving the nature and purpose of the debt—clear evidence can make a difference.
Need a Lawyer?
Debts in One Name: Are You Still Liable?
One of the biggest misconceptions is that if a debt is only in your ex’s name, you won’t be held responsible. Unfortunately, this isn’t necessarily true. Family law looks beyond whose name is on the paperwork—it examines intent and use.
For example, if your ex took out a credit card after separation but used it for shared bills or children’s needs, it might be considered joint. However, if they used it for personal luxury items, you could argue it shouldn’t affect your share of the settlement.
Key Takeaway: Don’t assume a debt’s ownership is defined by whose name it’s under—how it’s used often matters more.
How to Protect Yourself From Unfair Debt Allocation
If you’re separated and heading toward divorce, here’s what you can do to protect your financial interests:
- Keep detailed records of post-separation expenses and communications.
- Avoid joint accounts or loans post-separation if possible.
- Finalise your property settlement early to draw a financial line.
- Seek legal advice to get tailored support for your specific circumstances.
If a property settlement isn’t reached quickly, you may remain financially connected far longer than you’d like.
Key Takeaway: The longer your finances stay entangled post-separation, the more vulnerable you are to liability for new debts.
Can You Be Forced to Pay Your Ex’s Debts?
Yes, but only under specific circumstances. The Family Court has the discretion to assign debts as shared responsibilities if they are deemed to benefit the family or fall within reasonable financial behaviour. That said, if your ex was reckless or intentionally destructive with finances, the Court may rule those debts as their sole burden.
Evidence, timelines, and how finances were managed post-separation will all play a part in that judgment.
Dealing with debts incurred after separation but before divorce can feel like walking a financial tightrope. Understanding how the law works—and how you can proactively protect your interests—will put you in the strongest possible position when negotiating your property settlement.
Always consult a family lawyer to help you build a case and push for a fair result.