Precision and care should be taken when planning your estate to ensure that those you leave behind are looked after. If you have never thought about superannuation and your estate or if you have taken it into consideration, here are some things to consider:
What is Superannuation?
What exactly is superannuation? It is sometimes simply referred to as ‘super’, and it is money that is put away periodically by yourself, an employer or a trustee that can only be accessed after a certain age and generally be applied to your retirement later in life.
Who Can Receive Your Superannuation?
Superannuation is an asset just like your car or house, but it doesn’t actually form part of your estate (the sum of your assets of net worth). Superannuation is held in a trust, and it is up to the nominated Trustee of your superannuation fund to distribute the funds to the beneficiaries accordingly.
Eligible dependents/beneficiaries include:
- Your spouse
- Any or all of your children under legal age
- Anyone who is financially dependent on you
In the case of your passing, you can expect your nominated beneficiaries to receive the balance of your super account in the form of a lump sum or pension.
How Do You Nominate Your Beneficiaries?
In order to legally nominate beneficiaries to receive your superannuation funds, a Binding Death Nomination Form should be completed and lodged with your superannuation fund. When completing a Binding Death Nomination ensure that:
- The form is free from errors
- Update the form regularly as it needs to be less than three years old when you die for it to be valid
- The original copy is available upon your death
By following these guidelines, the Trustee of your superannuation fund will be guided by your Binding Death Nomination and able to distribute your superannuation funds to your chosen beneficiaries following your death.
If you need assistance with estate planning, the experienced accountants at Stones Sharp can help make sure your estate is distributed in accordance with your wishes – with minimal confusion or dilution by tax and fees. Contact us to book your appointment today.
FCPA & CA
Shane is a Fellow of the Australian Society of Certified Practicing Accountants and a Chartered Accountant.
Shane’s passion is to consider the clients, the client’s business and taxation affairs with a holistic approach whilst providing business mentoring, business strategies, systems development, taxation advice and taxation planning in order to assist his clients and their business achieve their goals.