---
title: "Friends, Flatmates or Defactos and how to tell them apart - Sapience Financial"
description: "Discover the legal complexities of de facto relationships and how they impact super and life insurance payouts, family law claims, and property interests. Get insights on modern relationship dynamics."
url: "https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart"
date: "2026-06-01T05:54:54+00:00"
language: "en-GB"
---

#  Friends, Flatmates or Defactos and how to tell them apart

- 🌳 Family, Legacy & Aging
- [ blending families ](https://finallysorted.com.au/all-tags/blending-families)
- [ LGBTQIA+ ](https://finallysorted.com.au/all-tags/lgbtqia)
- [ binding nominations ](https://finallysorted.com.au/all-tags/binding-nominations)
- [ defactos ](https://finallysorted.com.au/all-tags/defactos)
- [ pride in advice ](https://finallysorted.com.au/all-tags/pride-in-advice)
- [ 🌳 Family, Legacy & Aging ](https://finallysorted.com.au/insights/family-legacy-aging)
- [ ⚖️ Estate Law & Succession Planning ](https://finallysorted.com.au/insights/estate-law-succession)

  ![faces of different types of friends](https://finallysorted.com.au/images/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart-sapience-financial.jpg) Seemingly small differences in your personal relationships can have a profound (and surprisingly expensive) effect when officially considered under different government legislation. Reading Time: 10 minutes

---

### Friends, flatmates or de facto partners - and how to tell them apart

### When it comes to romance and relationships, the emotional decision about who you think is your partner, may be very different from the legal decision about who is legally considered your de facto partner.

The questions about who may be a *boyfriend* or *girlfriend* and who is a *de facto* become important distinctions when it comes to **super** payouts, **life insurance** payouts, and **family law** claims on your finances, investments and property interests.

#### *In this article read:*

 - [Modern families, friendships and relationships](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#modern-families-friendships-and-relationships)

- [What the law says constitutes a de facto relationship](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#what-the-law-says-constitutes-a-de-facto-relationship)
- [What does ‘genuine domestic basis’ mean?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#what-does-genuine-domestic-basis-mean)

- [When is a relationship considered a de facto relationship?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#when-is-a-relationship-considered-a-de-facto-relationship)
- [Why is this important?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#why-is-this-important)

- [Why this matters for everyone?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#why-this-matters-for-everyone)
- [Why does this matter for people with superannuation?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#why-does-this-matter-for-people-with-superannuation)

- [Why does this matter for people accessing the Family Law Court?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#why-does-this-matter-for-people-accessing-the-family-law-court)
- [Why does this matter for LGBTI people?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#why-does-this-matter-for-lgbti-people)

- [Why does this matter for people receiving Centrelink payments?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#why-does-this-matter-for-people-receiving-centrelink-payments)
- [What are the options?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#what-are-the-options)

- [**'Am I in a de facto relationship?'**](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#am-i-in-a-de-facto-relationship)
- [Frequently Asked Questions: De Facto Status](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#frequently-asked-questions-de-facto-status)

    - [At what point could a court decide we're actually in a de facto relationship?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#at-what-point-could-a-court-decide-were-actually-in-a-de-facto-relationship)

    - [Is there a specific time—like two years—after which they can claim my house?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#is-there-a-specific-time-like-two-years-after-which-they-can-claim-my-house)

    - [Is keeping our finances completely separate enough to protect my assets?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#is-keeping-our-finances-completely-separate-enough-to-protect-my-assets)

    - [What is the best way to protect my existing assets before moving in?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#what-is-the-best-way-to-protect-my-existing-assets-before-moving-in)

    - [Does having a sexual relationship automatically make us a de facto couple?](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#does-having-a-sexual-relationship-automatically-make-us-a-de-facto-couple)

- [Sources & Further Reading](https://finallysorted.com.au/blog/friends-flatmates-or-de-factos-and-how-to-tell-them-apart#sources-further-reading)

### Modern families, friendships and relationships

Today's modern relationships can be both complex and meaningful, so who is legally considered a de facto (and who therefore has an additional level of legally enforceable entitlements) can require some professional guidance, just to be sure.

- Sometimes people are living together but **unsure if their relationship is legally considered a de facto** relationship.
- Sometimes, a person who is **married** **may also have a second relationship that is a de facto** relationship
- Sometimes **some people could be considered to be in two de facto relationships at the same time**, in the eyes of the law.

Regardless of what your relationship status is, it pays to know what its legal status is too.

### What the law says constitutes a de facto relationship

The definition of a de facto relationship in Australia is when two people - regardless of gender - who are not married and not related - are living (or have lived) together on a ‘**genuine domestic basis**’.

- This terminology is from the **Family Law Act 1975** and it's the primary question that needs to be asked to ascertain if you are in a de facto relationship.

### What does ‘genuine domestic basis’ mean?

This means considering how the relationship is distinguished from other forms of relationships such as; with someone you’re casually dating, or with a housemate, or with someone you are caring for in exchange for discounted rent or another form of payment.

A situation where this could arise is when people start out as flatmates, then had some form of sexual relationship, but never had the intention of living together on a genuine domestic basis.

### When is a relationship considered a de facto relationship?

The most well-known rule of de facto status is said to be ‘**when two people have been living together continuously for more than two years**’.

But what you may not know is **the two-year rule does not apply when** any of the following occurs:

- a **couple who have a child together** are considered to be in a de facto relationship, and even though they have not yet been living together in a relationship for two years,
- When **two people decide they’re going to purchase a property** in both names **and move in** together
- When two people have been living together and then **decide to buy a property together before that two year period has passed**.
- When **people live together and substantially intermingle their finances**, it muddies the waters when determining the nature of their relationship if they haven’t yet been living together for over two years. Operating a joint bank account etc. may indicate their de facto status.

### Why is this important?

Whether you're part of a casual relationship, officially a de facto, perhaps a carer, or maybe you’re together but living apart (TLA) - these seemingly small differences in your personal relationships can have a profound (and surprisingly expensive) effect when officially considered under different legislation.

- The **[Family Law Act](https://www.legislation.gov.au/Details/C2019C00101/Html/Volume_1)** in Australia recognises de facto relationships, which usually provides both de facto parties the same legal rights and responsibilities as marriage and the rights to make a property claim.
- The **[Superannuation Law](https://www.legislation.gov.au/Details/C2020C00055)** in Australia recognises de facto relationships, and provides special rights and payouts tax free, and importantly the right to receive payouts directly from the super fund rather than having to compete for it with other beneficiaries of a person's Will or general estate.

### Why this matters for everyone?

- You need to be **aware of the potential consequences of moving in with friends**, partnering up, or something in between.
- You need to be **aware if a former partner is likely to be able to make a claim** for property settlement.

### Why does this matter for people with superannuation?

A person who is legally recognised as your de facto has special legal status and entitlements both in **Family Law** (entitlements to financial and property) and **Superannuation Law** (entitled to super benefit payouts and significant tax savings).

If you’re unable to prove you were a de facto couple (to the satisfaction of the Family Court and or a Superannuation Trustee) and both are arguably highly subjective, this could mean;

- your life partner is at risk of not receiving an expected payout,
- they may have to pay unnecessary and significant levels of tax on any payments received, and
- they could miss out altogether on your desired wishes.

Any super payout could also be sent to your ‘ex-partner’ instead.

### Why does this matter for people accessing the Family Law Court?

Before a family law court can make any orders of a financial nature, the court must first decide if the parties involved were officially recognised in the eyes of the law as de facto.

- If the relationship does not fit the required legal standard, then the Court has no jurisdiction to make financial orders.

### Why does this matter for LGBTI people?

For many people in the LGBTI community, Marriage Equality has only recently been legally recognised. This means many LGBTI may be partnered and unmarried and there can be a number of relationships and circumstances that don't fit the current legal view of 'who is officially recognised' as a de facto partner.

- For example: those who are principally acting as a carer for someone, those who may be Together Living Apart (TLA) from their partner for a number of reasons, those with living arrangements not seen as meeting the de facto standard of assessment.

### Why does this matter for people receiving Centrelink payments?

When deciding if a person is part of a couple or just flatemates, Centrelink will take into account the financial aspects of the relationship, the nature of the household, the social aspects of the relationship, any sexual relationship between the parties involved, and the nature of the people's commitment to each other and whether they’re not living separately on a permanent or indefinite basis.

- If you’re in a de facto relationship, and you’re **receiving benefits or payments calculated or based on your relationship status**, you’ll need to notify Centrelink if you enter into a de facto relationship.

### What are the options?

- If you need to prove you are a person's official partner, there are **three main ways** to do that if required.

 ###  Get Officially Married

**Get officially Married**. A marriage record is sufficient to remove any doubt a couple was mutually committed to a shared life together.

- Marrying can also avoid some of the obstacles of proving a de facto relationship exists under current superannuation law.

###  Get Officially Registered

**Get officially Registered.** You can register your official de facto status in most Australian states.

- Officially registering your de facto relationship is an easy and straightforward way to formalise your de facto relationship status and formally express your commitment to each other. You can simply rely on your relationship certificate as proof of your de facto status for legal purposes or to satisfy government agencies and/or receive tax, Centrelink or superannuation benefits.
- As your relationship will be legally recognised, this means **you won’t have to satisfy any other criteria** in order to prove you are in a de facto relationship.

You can also easily *update your status* if you later separate by lodging the appropriate form with the Births, Deaths and Marriages Registry of your state.

- Here is the [NSW Registration Service](https://www.service.nsw.gov.au/transaction/apply-register-relationship-nsw)
- Here is the [QLD Registration Service](https://www.qld.gov.au/law/births-deaths-marriages-and-divorces/marriage-weddings-and-civil-partnerships/civil-partnerships/fill-in-a-civil-partnership-application-form)
- Here is the [VIC Registration Service](https://www.bdm.vic.gov.au/marriages-and-relationships/register-a-domestic-relationship)
- Here is the [WA Registration Service](https://www.familycourt.wa.gov.au/D/defacto_relationships.aspx)
- Here is the [SA Registration Service](https://www.sa.gov.au/topics/family-and-community/births-deaths-and-marriages/marriages-and-relationships/register)
- Here is the [ACT Registration Service](https://www.accesscanberra.act.gov.au/app/answers/detail/a_id/2096/~/civil-union-registration)
- Here is the [Tasmanian Registration Service](https://www.justice.tas.gov.au/bdm/significant)

###  Get Prepared

**Get Prepared**. If you or your partner needs to prove your de facto relationship status without an official relationship registration certificate, you will need to understand what's required to prove the existence of your de facto relationship to **Centrelink**, **The Family Law Court** or a **Superannuation Trustee**.

When a court makes a decision about whether someone was in a legally recognised relationship, they require evidence and consider a wide variety of issues including:

- the duration of the relationship
- whether or not a sexual relationship exists
- ownership, use, and acquisition of property
- the degree of financial interdependence, and any arrangements for support, between or by the parties
- the care and support of children
- reputation and public aspects of the relationship
- the degree of emotional support.

So a good question to ask yourself is simply:

### **'Am I in a de facto relationship?'**

---

### Frequently Asked Questions: De Facto Status

#### At what point could a court decide we're actually in a de facto relationship?

There's no single 'test,' but a court looks at a whole picture of your lives. They’re looking for a **'merger' of your lives** that points to a genuine domestic partnership. This includes public perception, the degree of financial dependence, any sexual relationship, and whether you have a mutual commitment to a shared life.

#### Is there a specific time—like two years—after which they can claim my house?

This is a common myth. There is no 'magic' two-year rule for automatic 50/50 entitlement. The two-year period is simply the **minimum duration** usually required before a person can ask the Family Court for a settlement. The court then considers initial financial contributions, non-financial contributions (like homemaking), and future needs.

#### Is keeping our finances completely separate enough to protect my assets?

No. The Family Court looks at the **entire asset pool** of the relationship, regardless of whose name an asset is in. If your partner paid for all the groceries (freeing you up to pay down your mortgage), the court sees that as a contribution to your assets. Only a formal legal agreement can truly quarantine assets.

#### What is the best way to protect my existing assets before moving in?

The most robust way is to create a **Binding Financial Agreement (BFA)**, sometimes called a 'prenup'. This is a private legal contract stating how assets would be divided if the relationship ends. For a BFA to be binding, both parties must receive independent legal and financial advice before signing.

#### Does having a sexual relationship automatically make us a de facto couple?

It is a key factor, but it doesn't define the relationship on its own. The court looks at **indicators together**. If a sexual relationship exists alongside financial interdependence and a shared social life, it builds a strong case. If it’s the only indicator of a couple-like dynamic, it may not be enough.

### Sources & Further Reading

- **The Legal Definition of a De Facto Relationship:** The criteria a court uses to determine if a de facto relationship exists are outlined in Section 4AA of the Commonwealth Family Law Act 1975.
    [Family Law Act 1975 - Section 4AA](https://www.legislation.gov.au/Details/C2021C00448/Html/Text#_Toc89998632)

- **The Court's Perspective on De Facto Relationships:** The Federal Circuit and Family Court of Australia (FCFCOA) provides a clear summary of the factors they consider when determining the existence of a de facto relationship.
    [FCFCOA - De facto relationships](https://www.fcfcoa.gov.au/fl/fp/de-facto-relationships)
- **Time Limits for Property Claims:** The FCFCOA website specifies the strict two-year time limit for making an application for property adjustment after the breakdown of a de facto relationship.
    [FCFCOA - Time limits for property and financial orders](https://www.fcfcoa.gov.au/fl/fp/time-limits)
- **Binding Financial Agreements (BFAs):** Information about creating legally binding agreements to protect assets is provided by the FCFCOA, outlining their purpose both before and during a relationship.
    [FCFCOA - Financial Agreements](https://www.fcfcoa.gov.au/fl/fp/financial-agreements)
- **Plain-Language Guide for NSW:** Legal Aid NSW offers user-friendly factsheets explaining the law around de facto relationships in a simple, easy-to-understand format.
    [Legal Aid NSW - Are you in a de facto relationship?](https://www.legalaid.nsw.gov.au/publications/factsheets-and-resources/are-you-in-a-de-facto-relationship)

---

**Do we sound like the type of people you'd like to do business with?**
 Call us today on 1300 137 403 or email us [here](https://finallysorted.com.au/index.php?Itemid=704) for a no-obligation private chat about your situation.

---

![author pic drew browne](https://finallysorted.com.au/images/author-pic/contact-drew-browne-advisor-sapience-financial.jpg)**Drew Browne** is a specialty Financial Risk Advisor working with Small Business Owners & their Families, Dual Income Professional Couples, and diverse families. He's an award-winning writer, speaker, financial adviser and business strategy mentor. His business Sapience Financial Group is committed to using business solutions for good in the community. In 2015 he was certified as a B Corp., and in 2017 was recognised in the inaugural Australian National Businesses of Tomorrow Awards. Today he advises Small Business Owners and their families, on how to protect themselves, from their businesses. He writes for successful Small Business Owners and Industry publications. You can read his Modern Small Business Leadership Blog [here](https://finallysorted.com.au/index.php?Itemid=1267). You can connect with him on [LinkedIn](https://www.linkedin.com/in/drewbrowne/).  Any information provided is general advice only and we have not considered your personal circumstances. Before making any decision on the basis of this advice you should consider if the advice is appropriate for you based on your particular circumstance.

![Written by Human Not made by AI sapience financial ](https://finallysorted.com.au/images/icons/not-made-by-AI-sapience-financial-black.png)

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