Division of Property and Equalization of Net Family Property

Division of Property and Pensions In Divorce or Separation


In the case of divorce, distribution is an important factor in determining how property and funds are handled.

Property can include everything owned by an individual:

  • Houses and real estate;
  • Cars and vehicles;
  • Personal and household items;
  • Bank accounts, RRSPs, investments, pensions, other financial assets;
  • Businesses

If one partner was legally married, and the other in a common-law relationship, their property will be split. A Canadian’s spouse should be the sole heir if they die without a will.

Marriage requires spouses to share property equally. Creditors cannot seize any property that a spouse has acquired during the marriage. Spouses must share any increase in the value of property owned by one spouse at the start of the marriage.

In common law, you can own as much or little of your shared property/money with your partner. You would divide or share items so that the two of you would have access to them.

If a couple gets divorced, a court may order one or both to make an equalization payment, or Net Family Property Equalization (NFP). The time limit to claim an equalized payment is 6 years after you separate or 2 years after the divorce.

The NFP calculation takes into consideration how much money a married person is worth at the end of a relationship, as well as what they brought into the marriage. NFP calculations do not consider gifts or inheritances received during the marriage.

In other words, NFP calculation will not include these assets as long as the spouse retains the gift/inheritance at the end of the marriage. However, if it was put towards the matrimonial home, it will be included in their NFP.


If you are in a common-law relationship, you may be entitled to property from your spouse. 

Unjust Enrichment

You may be able to claim a portion of your partner’s property if you contributed financially or in any other way to their property. When dividing the property of a married partner, the amount you receive is based on how much work you contributed.

Matrimonial Homes

The matrimonial home is a home that the married couple lived in just before they separated. Married couples can decide who gets to stay in the home they’re living in should they divorce. Neither spouse can sublet, rent, sell, or mortgage the home without the other’s permission.

The person who has the responsibility to care for children will usually live in the family home with them. This will help kids adjust to their new family situation in a place and neighborhood they are already familiar with.


Canada Pension Plan is a type of pension that most workers and employers contribute to. A person can divide their CPP pension credits when they are separating from a spouse.

Any other pension that you or your partner had while married is considered a piece of property under the Family Law Act and is included in the equalization calculation. The pension administrator will determine the value of assets. You would then decide whether or not to split the pension, and record this in your Settlement Instrument.

As of January 1, 2012, pension plan members can pay some or all of their settlement with a former spouse from the value in their pension plan. This new rule also applies to unmarried spouses who agree to share the value following separation.

Divorce can be a complicated process that involves dividing assets and dealing with finances, among other issues.

We highly discourage anyone from seeking out legal advice through this article. This article only provides general information and should you have any further questions regarding the division of property and pensions in family matters, please contact us to book a free initial consultation 905-366-0202 or through our website here.


Recent Posts

Scroll to Top

COVID-19 Update: Yes, we are open! We are accepting new clients and consultations over the phone and in-person.