If your fund’s trust deed allows it, SMSF members can nominate who will receive their benefits when they die via a death benefit nomination, which directs the fund’s trustee to pay their death benefit to their nominated beneficiaries.

Subject to the fund’s trust deed, the nomination can be either:

• binding, directing the trustees to pay the death benefit to a legal personal representative or dependant
• non-binding, notifying the trustees of the member’s preferred beneficiaries, leaving the trustees to make the final decision.

The trustees must ensure the nominated beneficiaries are entitled to receive death benefits under the trust deed and super law.

If the deceased member didn’t nominate a beneficiary, the trustee may decide which dependant the death benefit is paid to, or they may pay it to the deceased's estate for the executor to distribute according to the instructions in their will.