Tuesday, February 25, 2014

Receipt of superannuation death benefits

Following a recent post, I had a number of enquiries, and one particular adviser raised an issue with me which (as she flagged) is often overlooked.

The particular issue relates to the payment of superannuation benefits on death. The legislation requires (and there have been cases supporting this) that the recipient of any death benefit must be alive on the date of the payment themselves – in other words, if the recipient is no longer living at the date the payment is ultimately due to be made, then neither they (nor their estate) will be entitled to receive it.

There are a number of ways to minimise the impact of this rule, however the steps must always be taken as part of the overall estate plan.

Until next week.

Image credit: SalFalko via Flickr