Community of property
Current legislation
If people have not agreed on a prenuptial agreement, they are married in community of property. This means that the spouses share all property and bear all debts together, regardless of whether these were acquired or incurred before or during the marriage. In the event of divorce, the entire community of property must be divided equally. This means that on the one hand, the assets acquired during the marriage fall into the community and on the other hand, the assets and debts from before the marriage are included in the division.
An exception applies to so-called “attached goods and debts”, which do not fall within the community. An example of this could be a compensation for pain and suffering. We can provide you with more information about this. It is also possible that certain inheritances or gifts do not fall within the community of property. For example, a testator can include in his will that what he wishes to leave behind does not fall within a community (so-called “exclusion clause”). The donor can also stipulate this in the gift.
New legislation: limited community of property
On 28 March 2017, the Senate approved the initiative bill of the House of Representatives members VVD, D66 and PvdA to limit the scope of the statutory community of property. The law entered into force on 1 January 2018.
The new legislation is based on a limited community of property. The assets and debts of the spouses before the marriage no longer fall within the community, unless they were already common when the community came into being, such as a joint residence. Inheritances and gifts also no longer fall within the community, unless the testator/donor has imposed an inclusion clause. If a spouse uses his or her knowledge, skills and labour during the marriage to make efforts for assets that do not belong to the community, the results of these efforts must benefit the community. In that case, a right to compensation arises in favour of the matrimonial community. The extent depends on the circumstances of the case. If one of the spouses already has a BV before the marriage, the shares of that BV do not fall within the community. However, the increase in value since the marriage as a result of the labour efforts of the company must be compensated to the community. The rationale behind this provision is that the spouses share the fruits of labour efforts during the marriage. We foresee significant implementation problems with this provision.
Once the bill comes into effect, it will only apply to matrimonial communities that afterwards to arise.
We advise future spouses to obtain thorough advice on the legal implications of the bill.
Advice
If you are involved in an impending divorce, we will of course discuss with you whether the division you want is feasible and whether there are any fiscal pitfalls. For example, if one of the two wants to take over the owner-occupied home, it is wise to have a valuation carried out and to investigate whether the bank will cooperate in this allocation of the house to one of the two. If a company is part of the joint estate, a tax specialist and/or a business valuator is generally appointed to arrive at a valuation. We work together with a number of skilled financial specialists, whom we can consult on your behalf, even if it comes to legal proceedings.
