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The benefits of a binding death nomination

Posted on 30 July '15 by , under General News.

Signing a binding death nomination can help your beneficiaries make the most of tax savings in super.

A binding death nomination compels your super fund’s trustees to direct your super to the chosen dependent beneficiary upon your death. It also means your beneficiaries can receive any assets within the tax-effective structure of super. This is especially relevant for surviving spouses, so they can continue to receive tax-free income streams or superannuation payout upon death.

Those who do not sign a binding death nomination will most likely have their super passed to the beneficiaries at your will’s direction, which can result in assets falling outside the taxation structure of super.

Those who do elect to sign a binding death nomination will need to update it every three years unless they have a non-lapsing nomination. Non-lapsing nominations are available in some newer trust deeds, and can be helpful for looking after dependent children.