What is a binding death nomination for superannuation?

What is a binding death nomination for superannuation?

Binding death benefit nomination: This is a written direction from a member to their superannuation trustee setting out how they wish some or all of their superannuation death benefits to be distributed. The nomination is generally valid for a maximum of three years and lapses if it is not renewed.

Can a binding death benefit nomination be challenged?

Where a nomination is binding, the trustee has no discretion to override it. A challenge may only be made, for example, on the basis of the validity of the nomination, including a lack of legal capacity.

Who can receive a binding death benefit nomination?

1. Not everyone can be nominated. You cannot name just anybody in a Binding Nomination. A Binding Nomination can only be made in favour of your legal personal representative (ie your estate), your spouse, your children or someone who has an interdependency relationship with you.

What happens if you dont have a binding death nomination?

If you do not make a death benefit nomination, the trustee of the super fund may decide to pay your death benefit to your estate, or it may use its discretion to decide which of your eligible beneficiaries receive the death benefit.

Who can receive superannuation death benefits?

the deceased’s spouse or de facto spouse. the deceased’s former spouse or de facto spouse. a child of the deceased under 18 years old. a person financially dependent on the deceased.

What is the difference between reversionary and binding nomination?

Reversionary beneficiary – the nominated person (generally a spouse) will automatically continue receiving the pension after your death. Binding death benefit nomination – gives you certainty that your superannuation benefit will be paid to the beneficiary you nominate – there is no trustee discretion.

What is the difference between a binding nomination and a non-binding nomination?

The difference between Binding and Non-Binding beneficiary nominations is that one is binding on the trustee and one is not. As the name suggests, a Binding Nomination is binding on the trustee. A Non-Binding Nomination on the other hand is more of a ‘wish list’.

How long does a binding death benefit nomination last?

three years
Once you have made the nomination, it will be valid for three years from the date it was signed, or non-lapsing depending on the superannuation trust deed options. You can renew, change, update or revoke a nomination at any time.

Do all superannuation funds have a death benefit?

All superannuation funds have death benefit payments, which are usually made up of contributions as well as any insurance benefits attached to the policy. Superannuation fund death benefits are paid to a surviving partner, children or dependants, or to the deceased’s estate.

How does a binding nomination work in superannuation?

If the member made a ‘binding nomination’, the superannuation fund will pay the death benefit to the beneficiaries chosen by the member. A binding nomination allows a member to choose who they want their death benefit to be paid to.

What happens if I nominate someone for superannuation death benefit?

A non-binding nomination – where the people nominated should receive the death benefit, however, the trustee of the super fund will get the final say. So the result could be very different. Or no nomination, where the superannuation death benefit will either go to an estate, or the trustee of the super fund will determine who the beneficiaries are.

When does a binding death benefit nomination lapse?

How can I change my death benefit nomination?

You can set up or change your binding nomination by completing a valid Binding death benefit nomination form. You nominate who you’d prefer your account to be paid.