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Insights · 6 min read

Joint Marital Property, Marriage Agreements and Their Effect on Inheritance

Before an estate is divided, joint marital property must be separated first. Understand gono-gini, marriage agreements after Constitutional Court Decision 69/2015, and their effect.

When Pak Darmawan (a pseudonym) passed away, his children assumed that the whole house, the time deposits and the shares in the family company would go straight into the estate, to be divided between their mother and the three children. The family notary explained that there is one earlier step that is often missed: separating their parents' joint marital property. Most of those assets were acquired during the marriage, so half of them belong to their mother as the spouse and are not part of the estate. The only exception was the house in Semarang that Pak Darmawan had inherited from his grandfather. (This illustration is fictional and anonymised.)

That explanation changed the family's calculation significantly. Understanding joint marital property, separate property and marriage agreements is the foundation of every estate plan.

Joint marital property and separate property

Law Number 1 of 1974 on Marriage distinguishes two groups of property:

  • Joint marital property (harta bersama) is property acquired during the marriage (Article 35 paragraph (1)). In everyday language, it is known as gono-gini.
  • Separate property (harta bawaan) is property that each spouse brings into the marriage, plus property that each acquires as a gift or inheritance. This property is under the control of each spouse, unless the parties decide otherwise (Article 35 paragraph (2)).

For joint marital property, the husband or wife acts with the consent of both parties. For separate property, each has full rights to carry out legal acts (Article 36). That is why a bank or a Land Deed Official (PPAT) usually asks for the spouse's consent when an asset acquired during the marriage is sold or pledged as security.

Note that joint marital property does not depend on the name on the certificate or account. A house bought during the marriage in the husband's name is still joint marital property, unless a marriage agreement provides otherwise.

Joint marital property when one spouse dies

When a marriage ends through death, the first step is to separate the joint marital property. For Muslim families, the Compilation of Islamic Law (KHI) states that when a marriage ends through death, half of the joint marital property belongs to the surviving spouse. Civil law generally recognises a similar principle of division.

The estate is therefore:

the deceased's separate property + the deceased's share of the joint marital property, after deducting debts and related costs.

In many legal systems, the surviving spouse receives two things: half of the joint marital property as their own right, plus a share as an heir of the deceased's estate. Wrongly including all the property in the inheritance calculation can disadvantage the surviving spouse and trigger disputes.

For divorce, Article 37 of the Marriage Law states that joint marital property is governed by the respective laws, which its elucidation explains as covering religious law, customary law and other laws.

Marriage agreements

Spouses can arrange their property relationship differently through a marriage agreement (perjanjian perkawinan). It usually provides for full separation of property, partial separation, or specific arrangements for certain assets such as shares in a family company.

The original wording of Article 29 paragraph (1) of the Marriage Law only allowed an agreement to be made at the time of, or before, the marriage, and to be ratified by the marriage registrar. Couples who realised the importance of such an agreement too late had no way out other than divorce, which is of course not an option.

After Constitutional Court Decision 69/PUU-XIII/2015

Through Decision Number 69/PUU-XIII/2015, delivered in October 2016, the Constitutional Court (Mahkamah Konstitusi) declared Article 29 of the Marriage Law conditionally unconstitutional. Since that decision, a marriage agreement:

  • may be made at the time of, before or during the marriage, by mutual consent;
  • is ratified by the marriage registrar or a notary;
  • takes effect from the date of the marriage, unless the agreement provides otherwise;
  • may be changed or revoked during the marriage by mutual consent, provided this does not harm third parties.

This decision opened the way for agreements made after marriage, often called a postnuptial agreement. For such an agreement to be effective against third parties, it needs to be registered. Registration takes place at the Population and Civil Registration Office (Dinas Kependudukan dan Pencatatan Sipil) for marriages registered there, based on a 2017 circular of the Directorate General of Population and Civil Registration, or at the Office of Religious Affairs (Kantor Urusan Agama) for Muslim marriages.

One thing to understand carefully is the protection of third parties. An agreement made during the marriage must not harm creditors or other parties who already had a legal relationship with the spouses. For this reason, an agreement made during a marriage should be prepared together with a clear inventory of assets and liabilities.

Its effect on inheritance

A marriage agreement is not a document that only matters in the event of divorce. Its effect on inheritance is in fact very real:

  • It determines what becomes the estate. With separation of property, assets in each spouse's name generally become personal property. The deceased's estate can then be identified more clearly.
  • It protects the family business. Shares in a family company can be arranged so that they stay in the intended family line, for example by confirming that inherited shares and their growth remain personal property.
  • It separates debt risk. A spouse who runs a high-risk business can limit its impact on the family's property, while still respecting the rights of third parties.
  • It matters for mixed marriages. For an Indonesian citizen (WNI) married to a foreign national, without a separation of property agreement, land acquired during the marriage becomes joint marital property with the foreign spouse. This conflicts with the ban on foreigners holding freehold title (hak milik). Government Regulation Number 18 of 2021 confirms that an Indonesian citizen in a mixed marriage may hold the same land rights as other Indonesian citizens, provided the land is not joint marital property, as evidenced by a separation of property agreement made by notarial deed.

A marriage agreement does not replace a will or a gift, and cannot override the rights of heirs protected by law. The agreement sets out "who owns what" during the marriage, while inheritance instruments set out "to whom property passes" after death. The two complement each other.

Key points

  • Property acquired during the marriage is joint marital property; separate property, gifts and inheritance remain each spouse's own.
  • Before an estate is divided, the joint marital property is separated first; the surviving spouse's share is not part of the estate.
  • Since Constitutional Court Decision 69/PUU-XIII/2015, a marriage agreement may be made before, at the time of or during the marriage, and may be ratified by a notary.
  • An agreement made during the marriage needs to be registered and must not harm third parties.
  • For mixed marriages, a separation of property agreement by notarial deed is an important requirement for the Indonesian spouse to keep the right to hold land under freehold title.

If you would like to review whether the property structure in your marriage is in line with your family's estate plan, Parampara's consultation team can help assess it.

This article is general information and not legal advice. The legal effects of a marriage agreement depend on its contents and the facts of each case; consult a qualified notary or advocate about your situation.

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