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Property Division / Equalization
Net Family Property calculations under the Family Law Act — equalization payments, the matrimonial home, and excluded property.
Equalization of Net Family Property.
Ontario does not split assets 50/50 on separation. Under the Family Law Act, each spouse calculates their Net Family Property (NFP) — the increase in their net worth during the marriage — and the spouse with the higher NFP pays an equalization payment equal to half the difference.
Key rules
- The matrimonial home is treated specially. Its full value on the valuation date is included, even if one spouse owned it before the marriage.
- Excluded property — gifts and inheritances received during the marriage (if kept separate), personal injury damages, and life insurance proceeds may be excluded from NFP.
- Pre-marriage assets (other than a matrimonial home) are deducted as a date-of-marriage value.
- The limitation period for equalization claims is generally two years from divorce or six years from separation.
What the firm does
Preparation of Form 13.1 financial statements, NFP calculations, negotiation of the equalization amount, drafting of the equalization payment schedule into a separation agreement, and — where necessary — pursuing unequal division claims under section 5(6) of the Act.