Super and Death

Discussion in 'Legal Issues' started by Terry_w, 21st May, 2014.

  1. Terry_w

    Terry_w Member

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    Hi Marg

    very good point. It could. Anti detriments is essentially a refund of the contributions tax paid. the member benefit can be increased to reflect the tax.

    Its a complex area.
     
  2. marg4000

    marg4000 Member

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    And another very good reason for expert advice before switching funds.
    Marg
     
  3. Terry_w

    Terry_w Member

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    Its a minefield out there!
     
  4. Terry_w

    Terry_w Member

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    In my example of pulling the money out of super before death and saving tax the anti detriment tax savings would not be available to a beneficiary under a will unless that beneficiary was a dependant. So if the super death benefits end up being paid to the estate then there could still be a lot of tax payable.
     
  5. rabidz

    rabidz Member

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    Thanks for this info.
    I know nothing about this before.
     
  6. RandR

    RandR Member

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    Hi, I work for a very large super fund (that will remain nameless). The decisions around mortality claims are simply not made by the trustees themselves, but by dedicated staff who do nothing but process mortality applications. When it comes to lapsing/non-lapsing binding nominations, believe me, having seen first hand the negligence with which people treat their superannuation, non-lapsing nominations can be far too dangerous for a lot of people in the longer term.

    I'm interested in your opinion Terry. Mcintosh vs Mcintosh. Yes, the son may have been able to place the mother down as a binding nomination under an interdependent relationship, but would this have really completely prevented the other spouses solicitor contesting the benefit being received directly to the spouse after the fund has paid?

    The fund would have been out of the picture at that point and not involved in any following proceedings.

    From my observation the vast majority of people walking around think that their super is sorted out because they have made a non-binding nomination. Non-binding nominations are the biggest waste of space and can lead people easily into having an impression that they have got things sorted out.

    In the majority of cases without a BDBN the claims processors will try to do what the member/client has set out in any will if it can comply with the superannuation legislation. Normally if their is not a clear quick decision as to the most eligible dependent or dependents they will simply flick the benefits on to the estate to let the beneficiaries duke it out themselves. They do have a responsibility to look to pay eligible superannuation dependents first and foremost. Understand that they can only make decisions off the information provided to them by the potential beneficiaries. A lot of the time people have a very poor understanding of the eligibility criteria. I would highly suggest anyone who is involved in a claim as a beneficiary with a superannuation amount to contact the fund, talk to them specifically about your relationship to the deceased and ask to speak directly to the people handling the assessment, most of the time they will be more than happy to talk to you and will help you to ensure you submit everything they need.
     
  7. Terry_w

    Terry_w Member

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    Thanks Rand for that insider perspective.

    In McIntosh is the son did have a valid and binding BDBN to mum the super would never have hit the estate. Dad would have little option to challenge, except:

    1. Look for defects in the BDBN - if not dated or wtinessed by 2p people etc it could be invalide. It would then be up to hte trustee, or the superannucation complains tridbinal on who to distribute to. They may decide to follow mum's wishes anyway.

    2. Family provision. If someone hasn't be given adequate provision (and they are an eligible person} then that person could make a claim. The court would look at the situation and may rewrite teh will by chancing the gifts received.

    If there is not much in the estate then in some states, notably NSW, there is a notional estate order within family provision which allows non assets to be counted as part of the estate and orders made against these assets. This includes property held as JT, trust assets, property sold or given away within 3 years from death and SMSF and super in general.

    There are a few cases where non NSW residents or people with no connection to NSW have had their estate attached because of the fact that the Super fund is based in NSW.

    So Dad would have probably had to go this route.