Super Guy
  • Need Advice?
  • Membership
  • Contact Us
  • Resources
    • Superannuation
    • Nearing Retirement
    • Retirement
    • Financial Advice
    • Self Managed Super Funds (SMSF)
    • Investments
    • Insurance
    • Death Benefits
    • Superannuation Tax
    • Centrelink
    • Calculators
  • Free Super Tips
Select Page

Superannuation Death Benefit Calculator

Sep 9, 2023

This superannuation death benefit calculator is designed to help you calculate the death benefit payable to each beneficiary and the tax payable by the recipients.

A superannuation death benefit is a payment made to from a superannuation account to the beneficiary of the superannuation account in the event that the member passes away.

Superannuation death benefits can also include any insurance proceeds that were owned within the superannuation account.

There are rules around who is eligible to receive a superannuation death benefit and different tax rates that apply, depending on the relationship between the deceased and the beneficiary.
 

Who Can Receive A Superannuation Death Benefit?

 
Only a ‘superannuation dependant‘ is eligible to receive a superannuation death benefit.

Under superannuation law, a ‘death benefit dependant’ is defined as:

> the deceased’s spouse (including de facto)
> a child (any age) of the deceased
> a person who was in an interdependency relationship with the deceased just prior to death.

An interdependence relationship is defined as a close relationship between two people who live together, where one or both provides for the financial, domestic and personal support of the other.

 

Who Does Receive A Superannuation Death Benefit?

 
A Will does not determine who receives a superannuation death benefit.

A superannuation death benefit nomination is made by a member of a super fund to the trustee outlining who they would like their benefits paid to in the event of their death; remembering that the beneficiary must be a ‘superannuation dependant’.

The superannuation death benefit nomination can be binding or non-binding and lapsing or non-lapsing.

Alternatively, a reversionary pension will automatically revert to a reversionary beneficiary.

The reversionary pension will then count towards the beneficiary’s transfer balance cap.

Have You Read My Other Posts Yet?

  • Is Life Insurance Tax Deductible In Super?
  • Super Recontribution Calculator
  • Binding vs Non-Binding Death Benefit Nominations

Superannuation Death Benefit Tax Calculation

 
Superannuation balances are made up of three types of tax components: Tax-Free Element, Taxable (Taxed) Element and Taxable (Untaxed) Element.

Superannuation death benefits tax is calculated by first determining who the death benefit beneficiaries are and how tax applies to each of them.

Under taxation law, a death benefit tax-dependent includes:

> the deceased’s spouse or former spouse (including de facto)
> a child (under age 18) of the deceased
> a person financially dependent on the deceased
> a person who was in an interdependency relationship with the deceased just prior to death

A non-tax dependant is any outside of the above.

The tax-free element of a death benefit is always received tax free by the beneficiary regardless of whether they are a tax-dependant or non-tax dependant.

The following tax rates apply to the taxable elements of death benefits paid to tax dependants, as defined by taxation law:

Age of Deceased Death Benefit Payment Age of Beneficiary Tax on Taxed Element Tax on Untaxed Element
Any Age Lump Sum Any Age 0% 0%
Aged 60 & Above Income Stream Any Age 0% MTR less 10% tax offset
Below Age 60 Income Stream Age 60 & Above 0% MTR less 10% tax offset
Below Age 60 Income Stream Below Age 60 MTR less 15% tax offset MTR (no tax offset)

The following tax rates apply to death benefits paid to non-tax dependants:

Age of Deceased Death Benefit Payment^ Age of Beneficiary Tax on Taxed Element Tax on Untaxed Element
Any Age Lump Sum Any Age Up to 15% Up to 30%

^Death benefit payments are unable to be received as pension income streams by non-tax dependants from 1 July 2007. Death benefit income streams that began being paid to the dependant prior to 1 July 2007 are taxed in the same manner as income streams paid to tax dependants.
 

Superannuation Death Benefit Calculator

 
The superannuation death benefit calculator below can help you calculate the death benefits tax associated with a superannuation death benefit:

Chris Strano

Hi, I hope you enjoyed reading this article. If you want my team and I to help with your retirement planning, click here. If you prefer a DIY approach, then check out the SuperGuy HUB. Thanks for stopping by - Chris.

More Posts

Download our 6-step Super Check & take control of your super

Download now

Popular Posts

How Much Super Should I Have?


How Much Super  Do I need To Retire On $100K Per Year?


When Can I Access My Super?


How Much Super Do I Need To Retire At 60?


How Much Can I Salary Sacrifice Into Super?


Superannuation Contributions After Retirement. What are the Rules?

Popular Articles

How Much Should I Should I Have?

How Much Super Do I need To Retire On $100K Per Year?

When Can I Access My Super?

How Much Super Do I Need To Retire At 60?

How Much Can I Salary Sacrifice Into Super?

Super Contributions After Retirement. What are the Rules?

SuperGuy helps you maximise your super and build your retirement plan.



[email protected]

10/5 Markeri Street, Mermaid Beach, QLD 4218

CONTACT US

MAIN MENU
Contact
About
Meet the Team
Careers
Join SuperGuy HUB
Need Advice

RESOURCES
Superannuation
Retirement
Investments
SMSF
Insurance
Death Benefits
Transition to Retirement
Financial Advice
Online Calculators

HELP
Privacy & Cookies Policy
Terms & Conditions
Editorial Guidelines
Disclaimer

Copyright ©  SuperGuy 2023

Financial Advisor Melbourne | Financial Advisor Sydney | Financial Advisor Gold Coast