Who Gets Your Super When You Die?
Superannuation is a significant asset for most Australians. When you pass away, what happens to it is not automatic, it depends on how you’ve nominated beneficiaries, whether those nominations are valid, and your fund’s rules. Getting this right can avoid confusion, delay, or unintended recipients.
The Legal Framework & Basics
Your superannuation death benefit is not automatically part of your estate (i.e. it doesn’t pass via your will unless certain steps are taken).
The trustee of your super fund must pay your death benefit according to the fund’s rules (its trust deed), subject to superannuation law (SIS Act / Regulations).
If you make a binding death benefit nomination (BDBN) that is valid, the trustee must follow it (subject to eligibility). If you have a non-binding nomination, it is a guide to the trustee, but the trustee retains discretion.
Who Can Be Your Beneficiary?
Under superannuation law, you can only nominate certain categories of people (or your estate) to receive your death benefits:
Dependants, which under the law include:
• Your spouse (including de facto and same-sex relationships)
• Your children (including adopted, stepchildren, ex-nuptial children)
• Someone who was financially dependent on you at the date of death
• Someone in an interdependency relationship with you at the date of death (close personal relationship, living together, mutual financial support, domestic and personal care)Legal Personal Representative (LPR) — i.e. your estate via executor or administrator. If your death benefit is paid to your estate, distribution is handled via your will or intestacy laws.
If there is no valid binding nomination, or if the nomination is invalid or has lapsed, the trustee may:
Use its discretion to decide which dependants receive benefits
Or pay the benefit to your legal personal representative (i.e. your estate)
It’s also important to note that the tax treatment of a superannuation death benefit depends on who receives it and whether they are considered a dependant for tax purposes, which may differ from superannuation law.
Binding vs Non-Binding Nominations
Important points / pitfalls:
Not all funds support binding or non-lapsing binding nominations; you must check your fund’s rules.
Binding nominations must comply with formalities (signing, witnessing, correct format) — failure can render them invalid.
A binding nomination may still be challenged on grounds such as lack of capacity, undue influence, or non-compliance with fund rules.
Trustees have an obligation to act fairly and reasonably, but their scope is limited by their trust deed and the law.
Some binding nominations are “non-lapsing” (i.e. they don’t expire) if the fund allows, but this is not universal.
Even with a binding nomination, if the nominated recipient is no longer eligible at the time of death (e.g. relationship broken, person no longer a dependant), the nomination may fail.
For self-managed super funds, the rules can differ - some deeds allow non-lapsing nominations, and recent case law has created uncertainty about whether the three-year rule always applies.
How to Make a Valid Binding Nomination
To ensure your binding nomination is effective, follow these steps (or check your fund’s instructions):
Obtain the binding death benefit nomination form from your fund.
Complete it in writing, with full beneficiary details (name, date of birth, relationship, address, member number).
Sign and date it in the presence of two witnesses who are not named as beneficiaries.
Submit it to your fund.
Renew before expiry (if it is a lapsing type). The new nomination will replace the old one.
You can change or cancel the nomination at any time by submitting a new valid form.
Keep a record of your nomination, witnesses, and any correspondence.
If any nomination is invalid at the time of your death, the trustee will revert to discretion.
Common Pitfalls & Best Practice Tips
Letting binding nominations lapse — check expiry dates and renew in time.
Incorrect or ambiguous beneficiary details — full, correct, and precise details reduce risk of invalidation or dispute.
Overlooking the fund’s rules — some funds have additional requirements or restrictions.
Assuming online nominations are binding — many online tools default to non-binding forms.
Not aligning your nomination with your will / estate plan — your super benefit may bypass your will unless correctly structured.
Failing to review after life changes (marriage, divorce, children, separation) — your nomination may become outdated or invalid.
Complex family structures (blended families, stepchildren, dependants with special needs) — require careful planning and possibly tailored estate advice.
Trustee delays and disputes — recent reviews show many super funds are under scrutiny for how they handle death benefit claims (delays, poor communication, procedural deficiencies).
What Happens If Your Nomination Fails / No Nomination
If at the time of your death:
You have no binding nomination,
Or your binding nomination is invalid, lapsed, or fails due to eligibility,
then the trustee must exercise discretion within their rules. They typically consider:
Your dependants under law
The nomination you made (if it was non-binding)
Other relevant circumstances (e.g. financial need)
Your legal personal representative (i.e. estate) if appropriate
This discretion increases risk of outcomes different from your intentions.
Why It Really Matters
Your super is often one of your largest assets.
A valid binding nomination offers certainty and helps avoid disputes.
Without it, your super can end up in the hands of parties you didn’t intend.
Legal cases show that children may be bypassed in favour of a spouse or stepparent when nominations are absent or invalid.
The regulatory environment is increasingly focused on improving trustee accountability, timeliness, and transparency in death benefit processing.
General Advice Warning:
Any general advice on this page does not take account of your personal objectives, financial situation and needs, and because of that, you should, before acting on the advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. Information contained on this page was correct at the time of posting.