A death benefit is generally paid to a dependant (or dependants) of the member who has passed away, or to the member’s legal personal representative (LPR).
If the member doesn’t have any dependants or an LPR, the Trustee may use their discretion to pay the benefit to another person.
A death benefit claim can be made up of the superannuation account balance, less any applicable charges or taxes, and any death insurance cover the member may have had at the time of their passing.
Our insurer assesses whether any insured benefit is payable, and we, the Trustee, assess and determine who is eligible to receive the combined payment.
This can sometimes be a lengthy and complex process – particularly where there are multiple people claiming.
A beneficiary is the person(s) who will receive your super benefits if you die.
Beneficiaries can be nominated specifically by you (by making a beneficiary nomination (or nominations) for your super), or they can be identified and selected by the Trustee.
In either case the beneficiary(ies) must have met the relevant conditions under superannuation law that make them eligible to receive your super benefit.
For full details on the insurance cover we offer, including important definitions of key terms relating to permanent incapacity claims, refer to our handy Insurance in your super guide for members.
Making a death claim comes at a very challenging time for loved ones and relatives. Our Making a death benefit claim handbook has been designed to help you understand how the claims process works, including what you’ll need to do, and the key steps along the way.
An interdependency relationship
An interdependency relationship includes two persons (whether or not related by family) if:
An interdependency relationship also includes two persons (whether or not related by family):
Significant evidence is always required to demonstrate all interdependent relationships.
Evidence to support this can include joint ownership of a business or property, shared acquisition, affidavits from family, friends, associates etc., evidence of financial support such as rent receipts, mortgage payments, bank statements, text messages, photographs and much more.
A Legal Personal Representative is the person responsible for managing the deceased member’s estate either as:
A legal guardian must claim on behalf of any minor children of the deceased. The legal guardian will also be responsible for establishing a Trust Fund for the benefit to be paid into. The Trust Fund is a trust account that contains funds and/or assets that can be used for the child’s education and maintenance.
Under some circumstances, payment of a death benefit to a dependant child can also be made as a death benefit income stream. Income payments generally stop on or before the child’s 25th birthday and any remaining benefit is paid as a tax-free lump sum payment directly to the child. If the dependant child has a permanent disability, the income payments may continue.
Call our Service Centre and we’ll help you with the first steps of the claim and inform you of what’s involved with the overall process.
You’ll need to have the late member’s Catholic Super membership number, date of birth, date of death, and provide the contact details of all other possible beneficiaries.
We’ll also ask a range of questions in order to determine how best to initiate and proceed with the claims process.
Claim forms will be sent to all potential beneficiaries for completion. The following supporting documents will need to be provided:
Supporting documents will need to be certified before they are returned to us.
We will only be able to finalise the claim once all the necessary information from all potential beneficiaries is received.
Once we receive the required information from all potential beneficiaries, we will be able to start reviewing the claim.
If the member held death cover at the time they passed away, our insurer will review the application and determine if a death benefit is payable. They may require further information such as medical reports or a Coroner’s report. If further information is required, we will let you know.
The key legislation super funds must follow when making decisions relating to death benefit payments are:
A spouse and children under the age of 18 will be considered first over adult children who were not financially dependent on the member.
We can only consider another person if there are no other financial dependants claiming.
The assessment of any tax payable is only completed once the Trustee has determined and approved a beneficiary.
These key Legislations together with our Trust Deed provide strict guidelines that we must follow, even if that means making a decision that you may disagree with.
We will always contact you if we have any questions or require more information to assist in reaching a decision.
All parties will be notified of the outcome once a decision has been made.
All parties are invited to provide any additional information that might support an altered decision. Any additional information must be returned within 28 days for consideration.
Any objections to the decision are treated as formal complaints.
If any party remains dissatisfied following a review of an objection, the parties can refer to our external dispute resolution body, Australian Financial Complaints Authority (AFCA).
No payment of the benefit will be released to any beneficiary until we receive either agreement from all parties or instruction from AFCA on how to proceed.
Objections often result in lengthy delays in finalising the claim.
Once a decision is accepted by all beneficiaries, the benefit can be released as either by:
We always do our best to make a decision as quickly as possible, but the claims process can be complex. Most death claims usually take around four months to reach a decision from when we’ve received all the necessary information.
The process can sometimes take longer if:
Where there are multiple claimants, we need to write to each person and advise them of our decision. All claimants have 28 days to respond with their objection should they disagree. If no objection is received, we’ll pay the benefit in accordance with our original decision.
A death benefit may receive favourable tax treatment, depending on who receives the benefit, how it is paid, and providing the tax file number for the payee is provided.
*Refer to table below
Did you know that unlike your other assets, your super (including any insurance cover you have inside super) doesn’t automatically form part of your estate when you pass away?
The Trustee is responsible for distributing your death benefit if you pass away.
Type of benefit | Age of deceased | Age of beneficiary | Tax treatment - taxed element | Tax treatment - untaxed element |
Superannuation lump sum paid to dependant | Any age | Any age | Tax free | Tax free |
Superannuation lump sum paid to non-dependant | Any age | Any age | Taxed at a maximum rate of 15% (plus Medicare levy)* | Taxed at maximum rate of 30% (plus Medicare levy)* |
Account based pension paid to dependant | 60 years or older | Any age | Tax free | Taxed at marginal rates with a 10% tax offset |
Account based pension paid to dependant | Any age | 60 years or older | Tax free | Taxed at marginal rates with a 10% tax offset |
Account based pension paid to dependant | Under 60 years | Under 60 years & children between 18 and 25** | Taxed at marginal rates with a 15% tax offset | Taxed at marginal rates with no tax offset |
^ Financial advice services may be provided to members by the trustee’s related entity Togethr Financial Planning Pty Ltd (ABN 84 124 491 078; AFSL 455010)
* Plus Medicare levy of 2%.
** Children between ages 18 & 25 who are financially dependent. When the dependant turns 25 the remaining benefit must be withdrawn as a lump sum (tax free) payment unless the dependent child has a disablement as defined in legislation.
Catholic Super offers expert financial advice services through our licensed Financial Planners.
Our advisers can provide assistance on the likely impact of any benefit payment with regards to your personal financial situation, and help you make informed decisions about your benefit.
Catholic Super offers expert financial advice services through our licensed Financial Planners.
Our advisers can provide assistance on the likely impact of any benefit payment with regards to your personal financial situation, and help you make informed decisions about your benefit.
Remember, we’re here if you need us for assistance with the claims process, or if you have any queries about the progress of a claim, or for any insurance related queries.
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