Superannuation – Binding Nominations
Superannuation Death Benefits – you can’t just nominate anyone
Your ‘death benefit’ includes the money in the your superannuation account at the time of death plus any life insurance cover you have through your super fund.
Death benefits are not estate assets and therefore you generally cannot deal with your death benefits in your Will. It is the Trustee of your super fund who decides to whom benefits will be paid. You can provide guidance to the Trustee in the form of a Non-Binding Death Benefit Nomination.
If permitted by your Superannuation Fund, you can make a Binding Death Benefit Nomination that (if valid) must be followed by the Trustee.
In order to be valid, in both the Non-Binding and the Binding Death Benefit Nominations you can only nominate persons who are superannuation dependants pursuant to Superannuation Law, or your estate.
Your superannuation dependants are:
- your spouse (this includes a same-sex de facto partner)
- your child or children (of any age)
- someone who is financially dependent on you at the time of your death
- someone with whom you had an interdependency relationship at the time of your death.
The above relates to lump sum payments, there are even more restrictions on who you can benefit by a pension.
Tax considerations also apply and should be taken into account when deciding who should you should nominate to receive your death benefit.
For more information please contact our friendly team on 9822 8611.