Property (Relationships) Act 1976, s 8

Relationship property is the property that must be divided between the parties when their relationship ends. Relationship property will usually include:

• family home and property (“chattels”) (including the family car, household furniture, and anything else owned by the family or used for family purposes – these are all usually considered relationship property regardless of who paid for them or when they were acquired)
• family businesses and investments (the general rule is that any business used to produce family income and any savings or investments made out of family income are treated as relationship property)
• property owned jointly or in equal shares by the partners
• property acquired during the relationship (if the property was acquired before the relationship but it was intended for common use or benefit, it can be considered relationship property)
• contributions to superannuation and insurance policies after the relationship began, including KiwiSaver
• increases in the value of relationship property, or any income from it or any proceeds from selling it.

Property (Relationships) Act 1976, ss 9, 10

Separate property is the property of each partner that is not relationship property. The general rule is that separate property remains the property of the person who owns it and does not have to be divided according to relationship property law.

Separate property includes:

• property acquired by either person while they are not living together as a couple
• property acquired out of separate property and any proceeds of sale of separate property
• gifts, including things like family heirlooms and taonga, that was given to and used by only one person
• increases in value of separate property
• income, interest or dividends earned from separate property
• property from another, third party which is given to only one of you as a gift, inheritance, or because the person is a beneficiary under a trust settled by a third party.

Things that are considered separate property can sometimes become relationship property later – see below.

Note: Gifts given by one partner to the other are not relationship property unless the gift is used for the benefit of both spouses or partners.

Property (Relationships) Act 1976, s 9A

Separate property may become relationship property if it gets mixed with relationship property or used for family purposes. For example, separate property may become relationship property if it is used to acquire or improve relationship property.

For example, money one person gets from an inheritance is separate property, but it’d likely become relationship property if it’s used to pay off some of the mortgage on your family home. You wouldn’t be able to claim this money back as separate property.

Separate property can become relationship property if one person works on it or uses relationship property to improve it. In that case, the increase in the value of the separate property is considered to be relationship property.

For example, if one person inherits a vintage car, this might initially be separate property. But if they use shared money to fix it up, the increase in the value of the car would become relationship property.

Property (Relationships) Act 1976, ss 20, 20D

Debts are separated into two categories: personal debts and relationship debts.

Personal debts are the responsibility of the person who took the loans out (“incurred” the debts).

Relationship debts usually fall into one of the following categories:

• joint debts
• common enterprise (or joint business) debts
• debts taken out to acquire, improve, maintain or repair relationship property
• debts taken out for the benefit of both parties in managing the household
• debts taken out for bringing up children of the relationship.

To calculate the total value of the relationship property you own together, first add up all your relationship property, and then minus any relationship debt. Whatever is remaining will be divided between you (including if it is a negative balance).

Note: Whether a student loan is a personal debt or a relationship debt will need to be decided on a case-by-case basis.

Property (Relationships) Act 1976, s 2G

The general rule is that the property being divided under the Property (Relationships) Act is valued at the date of the court hearing. However, the court does have the discretion to set a different date for valuation if it thinks it is appropriate.

If there is any dispute about the value of property or household items, it is important for the parties to get independent valuations.