Death Benefits

Death Benefits

There are a number of options in terms of paying death benefits. There are also several compliance and tax issues to address.

With the payment of benefits, both lump sums and pensions are potentially available.

A summary of the steps involved, the documents needed and the timing necessary are given below.

1. Advise the administrator of the date of death.
2. Obtain a copy of any Nomination of Beneficiary and discuss it with the solicitor or executor handling the estate. Seek advice on the options with respect to potential beneficiaries.
3. Consider engaging a financial planner to seek advice on benefit payment options since these include a lump sum or a pension. The possible application of an anti-detriment payment also should be examined.
4. Supply a certified copy of the Death Certificate to the administrator.
5. Contact the bank used by the fund and supply them with a certified copy of the Death Certificate so they are aware that the deceased cannot sign documents. The bank should remove the name of the deceased from all accounts.
6. Repeat that exercise with share registries and other investment managers.
7. If the deceased was an individual trustee of the fund, consider whether a new trustee should be appointed.
8. If the deceased was a director of the corporate trustee of the fund, consider whether a new director should be appointed.

With regard to the trustee situation, any necessary changes can be delayed until the death benefit has been calculated and paid, although that should happen within 6 months of the date of death. There are different options, depending on the membership and trustee situation at the date of death. The table below illustrates the options:

Individual Trustees:

* Change required, meaning appointment of a new individual trustee

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