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Binding Death Benefit Nomination

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Binding Death Benefit NominationPOA
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Why should I have a BDBN?

An individual’s superannuation benefit (eg, the member’s account balance and/or insurance proceeds) is often their most significant asset (apart from their family home), yet many people are unaware that their superannuation benefit is not covered by their will.

Under most SMSF deeds, payment of a death benefit is left to the trustee’s discretion in the absence of some form of binding direction such as a binding death benefit nomination (BDBN) or an automatically reversionary pension. Accordingly, a BDBN can play a crucial role if a member would like certainty as to who gets their super proceeds on their death. It is also vital that BDBNs are prepared in conjunction with a member’s estate and succession plans, including their will.

Premium tailored service

Many of our clients rely on the free value-added template BDBN form provided with the product disclosure statement in our SMSF documentation (in new SMSFs and SMSF deed updates). This BDBN template can be used to achieve many simple nominations, including in relation to reversionary pensions (ie, for any account-based pensions and transition to retirement income streams that the member has in place at the time of their death).

However, having a tailored BDBN prepared by an expert SMSF lawyer is recommended to ensure the binding nomination covers an individual’s specific circumstances. This is especially important where clients have more complicated wishes for their superannuation death benefits such as where an SMSF member wishes to put in place a binding direction on the SMSF trustee in relation to:

  • payment of specific superannuation interests to their dependants or to their estate;
  • payment of particular fund assets to their dependants or to their estate; or
  • implementing child pensions.

We can provide an estimate in respect of completing your BDBN once we have your instructions and background details, including a copy of your current SMSF deed and will.

To assist in determining if you require our premium tailored BDBN service, click here.

What’s Included

  • Covering letter and completion checklist
  • Trustee resolutions
  • Binding nomination
  • Notifications to dependants
  • Binding Death Benefit Nomination Memo

For more information and related articles

For more information about SMSF succession planning strategies, click on the link below:

For more information about BDBNs, click on the articles listed below:

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