PSS and CSS Superannuation Splitting in ACT Divorce

If you or your partner works for the Commonwealth or ACT public service, there is a good chance one of you is on the Public Sector Superannuation Scheme (PSS) or the older Commonwealth Superannuation Scheme (CSS). These defined benefit schemes are among the most valuable — and most complicated — assets in any Canberra property settlement.

Unlike a standard industry super fund where the balance on your statement is the balance you split, PSS and CSS calculate benefits using formulas based on years of service and final average salary. The number on your annual statement is not the number the court uses.

Why Defined Benefit Valuations Are Different

Standard accumulation funds (AustralianSuper, UniSuper, HESTA, Aware Super) have a dollar balance that goes up and down with contributions and investment returns. That balance is the family law value.

PSS and CSS are defined benefit schemes. The future pension or lump sum is calculated from:

• Final average salary — the average of the member's salary over the last few years of service
• Years of membership — the accrual rate multiplied by the number of years in the scheme
• Contribution accumulation — the member's own contributions plus interest

The "family law value" of a PSS or CSS interest must be calculated using actuarial factors prescribed under the Family Law (Superannuation) (Methods and Factors) Approval 2025. The Commonwealth Superannuation Corporation (CSC) provides this valuation on request.

To request it, submit a family law information request to CSC. The turnaround is typically four to six weeks. The resulting valuation will show the "family law value" — often significantly higher than what the member sees on their annual statement, because the actuarial calculation captures the present value of future pension entitlements.

The Two Splitting Methods

Base amount split

A specific dollar amount is transferred from the member's interest to a new or existing accumulation fund in the non-member spouse's name. The base amount is adjusted annually using an interest rate set by the government — for the 2026-2027 financial year, the adjustment rate is 6.1%.

This means if a base amount of $100,000 is ordered today but the split is not executed for 12 months, the adjusted amount would be approximately $106,100.

Base amount splits provide certainty — the non-member spouse knows exactly what they receive.

Percentage split

A percentage of each future payment (pension or lump sum) is allocated to the non-member spouse when the member reaches a condition of release. The non-member shares in any growth between the valuation date and the payment date.

Percentage splits are more common when the member is close to retirement and the actual pension payments are imminent. They are riskier if retirement is decades away, as changes to salary, service length, or scheme rules could affect the ultimate payout.

The 28-Day Procedural Fairness Rule

Before the FCFCOA can make a superannuation splitting order, you must serve a copy of the proposed draft orders on CSC at least 28 days before filing in court. This gives the trustee the opportunity to:

• Verify that the proposed orders comply with PSS/CSS governing rules
• Confirm that the stated family law value is current
• Flag any technical issues with the splitting mechanism

Failing to serve the trustee is one of the most common reasons consent order applications involving super are rejected.

Tax Treatment of Superannuation Splits

Superannuation splits between spouses do not trigger immediate taxation. The transferred amount moves directly into a complying superannuation fund in the non-member's name. Tax is only assessed when the receiving partner eventually accesses their super under standard retirement rules (preservation age, retirement, or terminal illness).

The split itself does not create a taxable event for either party.

PSS vs CSS: Key Differences

PSS (Public Sector Superannuation Scheme) — the main scheme for Commonwealth public servants who joined between 1 July 1990 and 30 June 2005. Provides a choice between pension and lump sum at retirement. The defined benefit component is based on final average salary and years of membership, with a separate accumulation component for some members.

CSS (Commonwealth Superannuation Scheme) — the older scheme, closed to new members since 1 July 1990. Generally more generous pension benefits but fewer members. The valuation methodology is more complex due to the scheme's age and the interaction between defined benefit and member contribution components.

Both are administered by CSC. The family law information request process is the same for both schemes.

Practical Steps for ACT Couples

1. Request a family law valuation from CSC early — the four-to-six-week turnaround can delay your entire settlement
2. Decide on base amount or percentage split based on when the member expects to retire
3. Draft the superannuation splitting clause in your consent orders with the specific fund details, trustee ABN, and splitting method
4. Serve the draft orders on CSC and wait the full 28 days
5. File Form 11 with the FCFCOA, including proof of service on the trustee

The ACT Divorce Financial Split Guide includes template superannuation splitting clauses for both PSS and CSS, the CSC contact details for family law requests, and a super splitting checklist covering valuations, procedural fairness, and execution.

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