Trying to split a complex shapefile by australian states

Im trying to work with a 1:1 mill scale shapefile of the geology of Australia.

When the whole lot is loaded in to QGIS (over 200,000 polygons) it will freeze and go to slow to work with.

Ideally i would split the data by each state and just turn on which state i need at a time and that will hopefully run full speed.

However i cant figure out how to split the shapefile properly (700mb file) , Ive tried a vector layer split and clip in the geoprocessing tools but i cant get them to work properly. The clip tool just generates a blank shapefile (i tried drawing a polygon shape as a vector file as the output layer so maybe that part was wrong)