Superannuation is not dealt with in accordance with the terms of your will and is not deemed to be an Estate asset nor a personal asset.
Instead, you must complete a nomination directing the Trustee of your super fund to distribute your superannuation according to your wishes.
Without a valid Binding Death Benefit Nomination, the Trustee of the fund has discretion to pay the benefits out as it deems appropriate.
If you have a Self Managed Superannuation Fund (SMSF), you may complete a nomination via a Non-Lapsing Binding Death Benefit Nomination form which is used by the Trustee of the fund to determine where your funds will be distributed upon your death.
To be valid and binding, the Binding Death Benefit Nomination must nominate dependent beneficiaries or the Legal Personal Representative of your Estate and must be signed in the presence of two independent witnesses.
A dependent includes "the spouse of the person, any child of the person and any person with whom the person has an interdependency relationship".
If the Binding Death Nomination nominates a person that is not a dependent, then it will not be a valid nomination and is not binding on the Trustee. In this case, the Trustee of the fund will have the discretion to pay the benefits as it deems appropriate.
Binding Death Benefit Nominations should be a major part of the Estate planning process and members should ensure they understand where their SMSF benefits will be distributed upon their death and who will have discretion should they not have a valid Binding Death Benefit Nomination.
Please contact KK Partners Group if you wish to discuss your needs further.