VIC Death Benefit Paid to Beneficiary Who Died 3 Weeks Later?

[Willea3015]

My parents have passed away recently within 20 days of each other. My mother was a member of a APRA retail superannuation fund in pension phase with no insurance attached (over 70yrs). The death benefit was the accumulated balance in the fund.

• My father was her dependent beneficiary at her date of death.
• My father was living at her date of death.
• My father passed 20 days later.
• Probate hadn't been granted at that time

The APRA fund has determined via trustee decision that they will surpass my father and pay the death benefit to me. This means that I will have to pay 15% tax. If it was paid to a dependent spouse alive at the time of death there would be 0% tax. There is nothing in the SIS Act or the trust deed of the fund that I can find that states the beneficiary has to be living at the end of probate.

Could anyone please shed any light on if I have a leg to stand on here? Many thanks.

 

[Rob Legat - SBPL]

There is a traditional presumption at law that if a beneficiary dies within 30 days of a testator (the person with the will), then the beneficiary is considered to have died at the same time or just before the testator. This time period still shows up in some legislation.

For example, under the Victorian intestacy rules, section 70C of the Administration and Probate Act 1958 states that a person is not entitled to participate in the distribution of an intestate's estate (i.e. cannot be a beneficiary) unless they survive the intestate for at least 30 days.

If your mother's will had a requirement for 30 day survivorship, then that also may come into play.

I would anticipate in this case that either:

(a) The binding death nomination which the superannuation trustee holds provides that your father must have survived your mother for a period of at least 30 days to be eligible for the transfer;
(b) There is a will that makes the same requirement; or
(c) Your mother died without a valid will (in the trustee's opinion).

I suggest asking for the trustee's basis of reasoning, and going from there.