The terms of the trust deed for the member’s superannuation fund specify the persons who may benefit from the member’s death benefit. Usually, superannuation death benefits can be paid to a dependant of the deceased member or their legal personal representative (the executor or administrator of the estate of the deceased member). These terms are usually defined in the trust deed.
Commonly, the definitions in the Superannuation Industry (Supervision) Act 1993 (“SIS Act”) are adopted, although the trust deed should always be checked to ascertain if that is the position with the particular fund. Section 10 of the SIS Act defines ‘dependant’ to include:
(i) spouse of the member (‘spouse’ includes a de-facto partner and a same sex partner);
(ii) children of the member (child or children includes adopted children, step children, ex-nuptial children, a child of the principal person’s spouse (for the period that the child’s parent remains the principal person’s spouse), and any other person deemed to be a child of the principal person under the Family Law Act 1975); and
(iii) a person with whom the member was in an interdependent relationship at the time of their death. ‘Interdependent relationship’ is defined by the SIS Act as a close personal relationship between two people who live together, where one or both provides financial, domestic and personal support of the other.
The definition of ‘dependant’ is inclusive, and a person who is dependent on the member at the time of death need not also fit in one of the above categories to be a recipient of superannuation death benefits.
It should however, be noted that while dependents under the SIS Act may be the recipient of superannuation death benefits, they may not be entitled to receive them tax-free under the Income Tax Assessment Act 1997 (“ITA Act 1997”).
If you require further assistance in relation to superannuation death benefits or estate planning, please contact our team of experienced lawyers by clicking here to submit an online enquiry form or call us on 1300 QUINNS (1300 784 667) or on +61 2 9223 9166 to arrange conference or appointment.