How is property divided when we separate?

Equalization under Part I of the Family Law Act is a right that belongs to married spouses. It doesn't apply automatically to unmarried couples, however long they lived together — the Act's definition of “spouse” for this purpose means people who are married to each other, or who married in good faith even if the marriage later turns out to be void or voidable.

If you're separating from a common-law partner, the property rules are different — we cover that below.

Equalization compares what each spouse owned, minus debts, on one specific day called the valuation date — not on the day a court finally decides the case. The Family Law Act sets the valuation date as the earliest of: the day you separate with no reasonable prospect of getting back together, the day a divorce is granted, the day a marriage is annulled, the day one spouse files an application to divide property early because the other is putting shared property at serious risk while you're still living together (called improvident depletion), provided the court later grants it, or the day before a spouse dies.

Getting this date right matters, because it fixes both what counts and how it's valued — property acquired or debt taken on after that date generally isn't shared.

Some property is left out of the calculation: gifts or inheritances received from someone else during the marriage, money from a personal injury settlement, life insurance proceeds, and anything the two of you agreed by contract to exclude. Whoever claims an exclusion has to prove it.

The matrimonial home is the one asset this doesn't apply to. Even if you bought it with an inheritance or it was a gift, its full value on the valuation date is included — Ontario treats the family home as too important to the household to exclude, whatever paid for it.

Each spouse works out their own net family property: everything owned on the valuation date, minus debts, minus (with exceptions) what they brought into the marriage. The spouse with the lower figure is entitled to half the difference between the two, paid by the other spouse.

A court can order a different split — more or less than half — where an equal division would be unconscionable, for example if one spouse hid debts, ran up debt recklessly, or the marriage was very short. That outcome isn't the norm; it takes specific circumstances the Act sets out.

Unmarried couples don't have a right to equalization under the Family Law Act — property generally stays with whoever holds title or the account, however long you lived together or however the household ran. If you contributed to property that's only in your partner's name, your options come from ordinary property law rather than this part of the Act.

This is a real, separate area of law, and it works differently from equalization — a cohabitation agreement, covered elsewhere in this centre, is the clearest way to set your own rules in advance.

Our equalization calculator below walks through the same steps a lawyer would: each spouse's assets and debts on the valuation date, what's excluded, and the resulting payment. It's a starting point, not a final number — values on a specific date, especially for a home, a pension or a business, usually need a proper valuation.

Before a first conversation with a lawyer, gather what you can: a rough list of what you each owned and owed on the valuation date, and any bank, investment or mortgage statements close to that date.