Superannuation Death Benefits

If the deceased person had superannuation, the superannuation fund's trustee will determine who to pay the benefits to (either as a lump sum and/or an income stream).  

Where the deceased person had a valid binding death benefit nomination (BDBN)* or reversionary pension in place, the trustee has no discretion, and will be obligated to pay the superannuation in accordance with the relevant nomination.

If a BDBN had not been made, the superannuation trustee has the discretion to pay the superannuation to either the deceased's legal personal representative and/or their Superannuation Industry (Supervision) ACT 1993 (SIS) dependants.  Depending on the governing rules of the fund. The SIS Act death benefits can be paid to SIS dependants either as a lump sum and/or an income stream.

Whilst super does not automatically form part of the deceased's estate, if the superannuation death benefit is paid by the superannuation trustee to the legal personal representative (LPR) then it becomes an asset of the estate and is dealt with by the person’s will. Consequently, superannuation death benefits paid to a deceased estate are subject to a family provision application.

*Or an equivalent in the case of a self managed superannuation fund (SMSF).