What to Know About Binding Death Benefit Nominations
A Binding Death Benefit Nomination is required by your superannuation fund to direct where the proceeds of your superannuation death benefit will be deposited to when you die, as it does not automatically form part of your estate.
Why Do I Need a Binding Death Benefit Nomination?
It’s important to note that there can be differing tax implications dependent on whether you choose to direct your superannuation proceeds to your estate or directly to a beneficiary or beneficiaries.
What Happens if I Don’t Have a Binding Death Benefit Nomination?
In the event you don’t have a valid Binding Death Benefit Nomination in place, it is at to the discretion of your chosen superannuation fund trustee to choose where your superannuation death benefit is paid to.
Who Can Be Listed as a Beneficiary?
Below is the list of people who can be listed as your beneficiary for your Binding Death Benefit Nomination:
- Spouse or Defacto Partner
- Child, Stepchild or Adopted Child
- Financial Dependent – someone who is financially dependent on you at the time of your death. This can include your parents or an adult with a disability.
- Interdependent Relationship – Someone whom you have a close personal relationship with, and you provide domestic support & personal care for e.g. Sibling, friend or relative you live with.
- Executor of your Will – for inclusion in funds to be disbursed under your Will.
When Does a Binding Death Benefit Nomination Need to Be Updated?
Your Binding Death Benefit Nomination is valid for 3 years from the date you sign the form.
You will need to renew the BDBN every 3 years – it is recommended you set a reminder close to the renewal date to ensure it doesn’t lapse and become invalid.
To find out further information about Binding Death Benefit Nominations, contact our estate planning team today.
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