Where a member directs how their superannuation death benefits are to be paid after their death it is called a binding death nomination. It is a written direction to the trustee to pay the member’s superannuation benefits to certain dependents or LPR in proportions set out upon their death.
The normal valid period for a binding death nomination is 3 years. So every 3 years members should update their binding death benefit nominations. If the binding death benefit nomination is valid and in effect at the date of the member’s death, the trustee must pay the superannuation monies to the beneficiaries in the proportion set out in the nomination.
A member can amend a binding death benefit nomination at any time by completing a new binding death benefit nomination expressing the new intention of the member. A member can also revoke a binding death benefit nomination at any time by giving written notice, signed and dated by the member in the presence of two witnesses who are at least 18 to the trustee.
REMEMBER, the above are issues that auditors focus on when it comes to the audit of a SMSF. Our audits for funds start from $300 and follow a comprehensive audit plan.
DISCLAIMER: The above is general advice only, you should not act on this advice without consulting a professional adviser to discuss your personal circumstances.